TITLE:
A Study of Financial Acquisition Risk Identification and Prevention
AUTHORS:
Qingxia Zhang
KEYWORDS:
Financial Acquisition, Risk Identification, Risk Prevention
JOURNAL NAME:
Modern Economy,
Vol.8 No.4,
April
7,
2017
ABSTRACT: In this paper, the financial risk of Ping An
Insurance (Group) Company of China, Ltd. acquisition of Shanghai Jahwa United
Co., Ltd is divided into the target enterprise risk assessment risk, financing
risk and uncertainty of future earnings according to M & A links. The study
finds that the target enterprise value assessment under market approach is
close to the transaction price; the financing risk can be divided into long-term
risk and short-term risk; Uncertainty of future earnings arises from the
volatility of the stock price caused by the uncertainty of the target
enterprise. To reduce these three risks, this study suggests that M & A
companies adopt a variety of methods to comprehensively assess the value of the
target enterprise, rationally design the financing plan and pay close attention
to the target business operation.