How to improve M&A loans in China : a comparison and risk management angle

China is actively leading the Asia-Pacific M&A market with an ascending trend of transaction volume and $770 billion transaction volume in 2016. This trend makes financing fundamental, which affects acquisition scale, structure, consequence and even post-acquisition integration. M&A loans, launched in 2008, have become the most utilized pattern of M&A financing in China. Though it develops fast, multiple problems exist in practice. My research focuses on how to improve M&A loans by solving these problems. To compare the practice in the US and China's M&A lending markets, I explained the four main business models of M&A loans in China and illustrated the bank debt financing in LBO deals in the US. Based on the comparison, I maintained that the main reasons for the defects lay in both macro and micro levels and accordingly made suggestions. Especially, improvement in risk management would allow confidence in business development and product innovation. Thus the problems of credit preference and product homogeneity could be eased. I illustrated utilization of multiple models with a real case. The study also includes empirical and scenario methods in analysis.

Department dc:contributor.department

Sloan School of Management.

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2017

Author dc:creator

• Liu, Xiaohua, S.M. Sloan School of Management

Advisor dc:contributor.advisor

• Mark P. Kritzman.

• Sloan School of Management.

Statement dc:rights

• MIT theses are protected by copyright. They may be viewed, downloaded, or printed from this source but further reproduction or distribution in any format is prohibited without written permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/111449

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/111449