Empirical Analysis In The Merger And Acquisition Activity And Performance

During the30years of China’s economic transition, Firms seeking rapid growth anddevelopment of an important means of mergers and acquisitions is one of the important strategicbehavior in the process of business continuity management. Mature capital markets in the West,from1895to1904for the first time M&A wave has gone through five mergers and acquisitionswave of the last M&A wave occurred from1992to2000. Study abroad for mergers andacquisitions has been very thorough and meticulous, and formed a relatively complete frameworkand system. In China, with the1980s, decentralization of business rights and the expansion ofenterprise autonomy, the formation of a relatively independent business entities and stakeholders,corporate mergers and acquisitions began to appear. July5,1984, Baoding Textile MachineryFactory assume all debt of the target company to take over all the debt, mergers and knittingequipment factory in Baoding, the reform and opening up the case of the first case of mergers andacquisitions. In October1993, Shenzhen Baoan Group through the secondary market to buy19.8%stake in Industrial Co., Ltd. Shanhai extension of the total share capital, officially opened theprelude to China’s capital market, mergers and acquisitions.Although China’s capital market wasformally established only a short time in ten years, but has formed a strong concept of capitaloperations, mergers and acquisitions of listed companies is in the ascendant, especially in recentyears, China’s M&A market is subject to the impact of recession and weak storycontinuing todecline, M&A market in China to grow exponentially. Time of the mergers and acquisitions oflisted companies up to more than2000cases in1998and2003, mergers and acquisitionsincreasingly received theory and practice of community concern, and became a hot issue in China’scapital market enterprises through mergers and acquisitions to seek the path of rapid developmenttheory profession and practice of universal importance.Economists and financial experts in the past three years, mergers and acquisitions of listedcompanies (Reorganization) extensive and in-depth study, which also includes a useful explorationof China in recent years scholars study the core issue is one of the M&A (Reorganization) createvalue for listed companies, the answer to this question is not only important guiding significance tothe development of enterprises, and will directly affect the basic value orientation of regulatory andlegislative. In reviewing the research results at home and abroad, due to mergers and acquisitionsbusiness development in China time, although the rapid development of capital markets formergers and acquisitions relaxed stage, but decided to economic transformation of China’s capitalmarket and foreign mature markets still a greater difference. In this context, the research firm M& A (Reorganization) performance evaluation methods and influencing factors has a certaintheoretical and practical significance, on the other hand, if done well, mergers and acquisitions(restructuring) can give the continued operation and development of China’s enterprises a heavyburden. At the same time, many foreign research results not applicable to China’s capital market,the country has yet to be standardized and systematic, there are many worthy of study, while alsoproviding a lot of research opportunities.M&A performance study is the subject of the economic and operational level, Westernscholars have done a more in-depth analysis and description, this paper will combine thecross-knowledge of the multidisciplinary field of economics, statistics, quantitative economics, theuse of data envelopment analysis (DEA), select business revenue and total profit, total liabilities,themain business cost, the main business tax and surcharges, fees, the total assets of the six accountingindicators, for the2004Shanghai Stock Exchange146listed companies in mergers and acquisitionsoccurred, overall, respectively, from the perspective of different industries, from the perspective ofdifferent ownership structure from a different point of view of mergers and acquisitions, from theperspective of the listed company associated accurate measure of the mergers and acquisitionsbefore and after the company’s performance, the listed companies before and after the mergers andacquisitions performance changes, and to test their changes significantly, in order to draw validconclusions.The empirical analysis found that the Listed Company Merger and the mean overallperformance from small to large process, pre-merger six years (1998-2003) the acquisition of listedcompanies in the overall performance of the mean low performance changes, not mergers andacquisitions that year (2004)Obviously, the second year after the merger acquisition of listedcompanies (2006), the overall performance of the mean maximum, and then in2007, M&Aperformance of listed companies declined slightly, but still higher than the mean level of thepre-merger, indicating that the M&A activity in the in general or to a certain extent to enhance theperformance of listed companies.146enterprises studied for six years (1998-2003) pre-merger andacquisitions that year (2004), corporate performance one, where they do not exist significantdifferences in mergers and acquisitions and mergers and acquisitions of the year (2004)6years(2005-2010) enterprise performance there are significant differences, six years after the acquisitionof the first six years (1998-2003) and M (2005-2010), corporate performance there is a significantdifference. Mann-Whitney U test results once again that the M&A activity to enhance theperformance of listed companies in general or to a certain extent. Industrial listed companiespre-merger six years (1998-2003) and mergers and acquisitions that year (2004) there aresignificant differences in mergers and acquisitions that year (2004) and six years after the merger(2005-2010), there are also significant differences.This suggests that mergers and acquisitionsbefore and after the business performance, there are significant sex differences in mergers andacquisitions have a positive effect on the industrial performance of listed enterprises.Commercial career listed companies pre-merger six years (1998-2003) and mergers and acquisitions that year(2004) there are significant differences in mergers and acquisitions that year (2004) and six yearsafter the merger (2005-2010) did not exist a significant difference. The Mann-Whitney U testresults shows commercial career in the mergers and acquisitions around the performance and nosignificant sex change, which means that the acquisition does not have a material impact onbusiness performance. Six years (1998-2003) of the utilities listed companies in the pre-merger andacquisitions there are significant differences in the current year (2004), mergers and acquisitionsthat year (2004) six years after the merger (2005-2010), there are also significant differences. Thissuggests that mergers and acquisitions before and after the business performance, there aresignificant sex differences, mergers and acquisitions have a positive effect on the performance oflisted companies of the utilities. Real estate listed companies pre-merger six years (1998-2003) andmergers and acquisitions that year (2004) there are significant differences in mergers andacquisitions that year (2004) and six years after the merger (2005-2010), there are also significantdifferences. This indicates that the enterprise performance before and after mergers and acquisitionssignificant sex differences, mergers and acquisitions have a material impact on the businessperformance of real estate listed. Comprehensive class listed companies pre-merger six years(1998-2003) and mergers and acquisitions that year (2004) there are significant differences,mergers and acquisitions that year (2004) and six years after the merger (2005-2010) there aresignificant differences. Mann-Whitney U test results of the comprehensive listing of companies inmergers and acquisitions around the performance and no significant sex changes, mergers andacquisitions did not have a material impact on corporate performance.(2002) and Li Xin Dan andother findings contrast, industrial, utilities, real estate M&A performance highlight this conclusion.Legal person shares of listed companies pre-merger six years (1998-2003) and M&A (2004), thereare significant differences in mergers and acquisitions that year (2004) and six years after themerger (2005-2010), there are also significant differences. This indicates that the enterpriseperformance before and after mergers and acquisitions of difference, have a material impact M&Alegal person shares of listed companies performance. The state-owned shares of listed companiespre-merger six years (1998-2003) and mergers and acquisitions that year (2004) there aresignificant differences in mergers and acquisitions that year (2004) and six years after the merger(2005-2010) did not exist a significant difference.Mann-Whitney U test results indicate that theperformance of state-owned shares of listed companies before and after the mergers andacquisitions and no significant sex change, which means that the performance of mergers andacquisitions and is not state-owned shares of listed enterprises have a substantial impact.Outstanding shares of listed companies pre-merger six years (1998-2003) and mergers andacquisitions that year (2004) there are significant differences in mergers and acquisitions that year(2004) and six years after the merger (2005-2010), there are also significant differences. Thisshows the outstanding shares of listed companies after the merger only after a period of time demonstrated the effectiveness of mergers and acquisitions. This conclusion is inconsistent with thefindings of previous scholars, one major difference is the outstanding shares after the merger thecompany has brought significant benefits. Six years (1998-2003) pre-merger of horizontal mergersand acquisitions and mergers and acquisitions there are significant differences in the current year(2004), mergers and acquisitions that year (2004) did not exist six years after the merger(2005-2010), a significant difference. Horizontal mergers and acquisitions in the mergers andacquisitions before and after the performance and not a significant difference in performance didnot change significantly. Vertical mergers and acquisitions in the pre-merger six years (1998-2003)and mergers and acquisitions there are significant differences in the current year (2004), mergersand acquisitions that year (2004) six years after the merger (2005-2010), there are also significantdifferences. This shows that vertical mergers performance before and after the mergers andacquisitions have significant differences, that is, has been noticeably improved. Mixed mergers andacquisitions in six years (1998-2003) in the pre-merger and acquisitions that year (2004) there aresignificant differences in mergers and acquisitions that year (2004) and six years after the merger(2005-2010), there are also significant differences. This shows that vertical mergers performancebefore and after the mergers and acquisitions have significant differences, namely the acquisition oflisted companies to bring performance gains. This conclusion is inconsistent with the findings ofprevious scholars, the main difference is that the mixed M&A and vertical mergers andacquisitions to corporate governance performance has brought positive benefits to a certain extent,improve the performance of the company.This paper rate of return on total assets to reflect the level of profitability; level of tangibleassets reflect the value of the collateral; main business of the level of growth reflects the growth ofenterprises; the level of total assets to reflect the size of the business; merger performance of theDEA evaluation scores reflect the M&A performance. The panel cointegration analysis methods totest the above factors affect the performance of mergers and acquisitions. The study found lowerrates of asset profitability strong corporate balance sheets. May be due to: net asset profitabilitystrong endogenous financing capacity; enterprise asset profitability, its good operating performanceeasier to audit by the Commission in the stock market for equity financing are more likely thanthereby reducing the corporate M&A performance. The ratio of the level of tangible assets withthe asset-liability ratio has a significant negative correlation with the theoretical conclusionscontrary. The reason may be as follows: no collateral business credit in current liabilities accountedfor most of the current liabilities are mostly inventories and other current assets to besecured.Inconsistent with the developed Western countries, the company’s growth and the negativeimpact of debt ratio. Chinese enterprise growth and the debt ratio such cases reasons may be: theChinese in general have some growth, but growth difference between the Section enterprise is verylarge, enterprise growth is very unstable. Very poor, it is difficult to summarize a unified directionof the impact of corporate debt ratio. Asset size and asset-liability ratio was significantly positively correlated, in line with domestic and international theory. The reason: First of all, the assets oflarge-scale enterprises have a higher reputation and lower operational risks, and likely to win thetrust of creditors, the implementation of the debt financing; followed by China’s largelystate-owned enterprises of the assets of large-scale enterprise, government out of industrial policyand socialgoals often give credit incentives for enterprise, contributed to the company’s high debtratios.In this paper, the relevant data of China’s listed companies, testing the impact of thesemacroeconomic factors on M&A performance. This article first margin cointegration test methodproposed by Pesaran and Smith (1998) empirical analysis of whether there is a long-term stabilityof the cointegration relationship test the above theoretical analysis of macroeconomic factors on M&A performance, and then create relevant the causal features of the mutual influence of themacroeconomic factors of the measurement model checking M&A performance. The empiricalanalysis in this chapter in accordance with the inspection procedures of the ARDL model,respectively, to first order differential MAP GDP, TMV SHR, IR spectra, the M2sequence toestablish the unconstrained error correction Model (UECM). According to the Akaike InformationCriterion (AIC), no constraint error correction model of the optimal lag order of2. Subsequently,the cointegration test, MAP, GDP, TMV SHR, the IR, the M2sequence. If there is cointegrationrelationship, given the long-term coefficient between the variable and the error correction. Theempirical results show that the M&A performance and the macroeconomic development, thecointegration relationship between the development of capital market conditions and interest ratesand money supply. This and the previous theoretical results of the analysis is the same.Economicfluctuations, the level of inflation and the degree of development of securities markets, these threemacroeconomic factors change, enterprises endogenous financing and exogenous financing ratiowould improve. Which economic fluctuations, inflation level and degree of development ofsecurities markets of these three changes in macroeconomic factors,1%, the M&A performanceand the macroeconomic impact of the error correction coefficient is negative, in line with thereverse correction mechanism.That is, when the long-run equilibrium relationship between thedeviations from the M&A performance and macro impact factors exist to reverse the correctionmechanism will make the M&A performance and macro influencing factors gradually restored toits normal state. Toda,-Yamamoto, causality test results show that the performance and themacroeconomic development of mergers and acquisitions, capital market development as well asinterest rates and money supply between the two-way causal relationship. Toda-Yamamoto,causality test results can be a good illustration of the above ARDL cointegration test results,empirical conclusion is robust.