Causes and Control of Financial Risk in Mergers & Acquisitions

  •  Zongsheng Liu    


The mergers & acquisitions (M&A) of enterprises are the management activities with high risks which exist through the whole M&A activity, and the financial risk is the important influencing factor to impact the M&A. By analyzing of value evaluation, financing activity and financial risk in M&A, it is obvious that M&A is a property rights trading with high risk (and the financial risk is the important factor with the highest risk). Therefore, the before-event control and the mid-event control should be applied to prevent the financial risk, and the after-event control should be used to reduce the financial risk, and accordingly enhance the survival rate of M&A.

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