Analysis and Prevention of Financial Risk in China’s Shipping Enterprises Mergers and Acquisitions

Abstract

As can be seen from the overall development situation of the shipbuilding industry, the shipbuilding industry develops slowly due to the impact of the international economy. The development of the shipbuilding industry has encountered bottlenecks, namely sharply decreasing whole market demands of shipbuilding, and excess production capacity. Facing with the problems such as small production scale, inadequate order quantity, and scanty working capital funds, a group of small and medium sized shipbuilding enterprises tend o merger in a large scale so as to expand strength, improve competitiveness, promote cluster development of advantaged resources. However, various research statistics have shown that the financial risk of mergers has caused many failure cases. Therefore, the research on the financial risk of mergers and acquisitions of shipbuilding enterprises contributes to taking effective measures to prevent risk and improving the success rate of shipbuilding enterprises mergers.
Key words: Mergers and acquisitions; Financial risk; Shipbuilding enterprises in mergers and acquisitions; Target shipping enterprises