How Does Debt Financing Exacerbate M&A Failures?-- A Financial Stability Perspective Based on Suning.com's Acquisition of Carrefour China

With new retail models rising, traditional retailers are generally under pressure to transform. While debt financing has become an important tool for rapid expansion, the risk of highly leveraged debt is often overlooked. This paper discusses how debt financing exacerbates the failure of mergers and acquisitions (M&A) from the perspective of financial soundness, using the example of the M&A of Carrefour China (hereinafter referred to as Carrefour) by Suning.Com Co., Ltd(hereinafter referred to as Suning.com). The study finds that Suning.com relies excessively on short-term debt financing in M&A, which leads to uncontrolled debt levels and structural imbalance, thus affecting financial soundness. In summary, Suning.com is caught in a vicious cycle of debt pressure, financial deterioration, and operational difficulties. This paper highlights the need for enterprises to strengthen core business profitability and financial management to ensure sustainable development, balancing financing efficiency with risk prevention and control in strategic expansion. Therefore, this provides a new perspective for the study of the correlation between debt financing and M&A failure and certain warning significance for financial soundness management and risk prevention in corporate M&A financing decisions.