Author(s)

Qing Li

Corresponding Author

Qing Li

Abstract

The environment of market economy has a positive effect on the optimal allocation of resources, but the market economy itself has blindness, so there will be financial crisis from time to time in its development. Small and medium-sized enterprises (SMEs) have limited capital and insufficient ability to cope with the financial crisis, so many of them will face bankruptcy when the financial crisis occurs. The current situation of SMEs provides opportunities for mergers and acquisitions (M&A) for private enterprise with high-quality expansion. However, in M&A in private enterprise, there will also be huge risks because of cash flow risk and information asymmetry. If the risks cannot be effectively dealt with, the purpose of M&A in private enterprise cannot be realized. This paper analyzes risks of M&A in private enterprise under financial crisis, and discusses strategies to prevent the risks to provide help and guidance for practice.

Keywords

Financial crisis; Private enterprise; Mergers and acquisitions; Countermeasure