In the context of heightened globalization and competition, mergers and acquisitions (M&A) have become indispensable tools for organizations seeking growth and competitiveness. This research is focused on the evaluation of financial risks in mergers and acquisitions and seeks to construct a model for evaluating financial risks. Through the use of the improved Analytic Hierarchy Process (AHP), where each indicator will be evaluated by its corresponding value, financial risks in the M&A process of companies X and Y will be determined and financial integration strategies for M&A will be suggested. Results indicate that the stage of an industry’s life cycle significantly influences M&A financial risks: – Companies in growth industries are primarily affected by financing risk (0.265) and integration risk (0.272). – Companies in mature industries face greater pricing risk (0.259) and debt repayment risk (0.288). – Companies in declining industries are most impacted by integration risk (0.418). During Company X’s acquisition of Company Y, financial risk was assessed at a moderate level with a score of 2.57, indicating a 30% probability of moderate financial risk occurrence. Acquiring companies should select appropriate financial integration strategies based on their own circumstances and the characteristics of the target company to enhance corporate value and achieve M&A objectives.
