Legal analysis: PE acquisition: large-scale stock M&A funds generally use interest tax savings to increase transaction returns. Because the fund is mainly engaged in investment activities rather than business activities, the fund itself cannot apply for M&A loans, and even if the loans are made, the tax burden cannot be deducted. However, through professional arrangement of transaction structure, companies invested or controlled by PE can apply for M&A loans, or they can make tax planning and use interest to offset taxes.

MBO/LBO: From the perspective of the mode of action, characteristics and functions of MBO itself, if the transaction and subsequent integration and reorganization plan are properly designed, the management as the initiator can set up an enterprise as the acquirer and can raise funds through creditor's rights (bank merger and acquisition loans, bond issuance).

RTO, reverse takeover, is to control a listed company by acquiring its shares (shell company), and then the listed company makes a reverse takeover, making it a subsidiary of the listed company. From the perspective of M&A transaction, the two stages of reverse takeover are aimed at achieving control.

Increase in shareholding of major shareholders: In foreign countries, the shareholding of major shareholders is often an important indicator used by the market to speculate on future stock price performance. Observing whether the major shareholders use their own funds or loans to increase their holdings, we can see the speculation of the major shareholders on corporate returns and capital costs.

Legal basis: Article 5 of the Guidelines for Risk Management of M&A Loans of Commercial Banks: A legal person institution of a commercial bank that issues M&A loans shall meet the following conditions:

(1) Having sound risk management and effective internal control mechanism;

(2) The capital adequacy ratio is not less than10%;

(3) Other regulatory indicators meet the regulatory requirements;

(4) Having a professional M&A loan due diligence and risk assessment team.

Before starting M&A loan business, commercial banks should formulate M&A loan business process and internal control system, and report to the regulatory authorities. After issuing M&A loans, commercial banks should stop handling new M&A loans if they fail to meet one of the above conditions.