| After 40 years of vigorous development,Chinese family firms have occupied half of the traditional manufacturing industry.They are not only important in private capital,but also an indispensable part of the national economy.The first generation of family founders started primitive accumulation and steady operation in the 1980s.Family business showed great economic vitality at the beginning of their establishment,and the efficiency of family control was extremely astonishing.With the rapid development of China’s economy,family business also realized their own leap-forward growth.However,as China’s economic development enters a new normal and new drivers of growth are being replaced,family businesses are also facing the great challenges of industry upgrading,economic transformation and intergenerational inheritance.How to break the curse of "rich only for three generations”and how to maintain the competitive advantage and sustainable development of the enterprise while maintaining the family characteristics are the common concerns of practitioners and researchers of family business.The development mode of enterprise includes endogenous development and extension development.Existing literatures have detailed study of the innovation efficiency and internationalization tendency of family enterprises（Luo Hong＆Qin Jidong 2019;Xu et al.,2020）,the study of family business and M＆A still needs to be explored.The theory of Social Emotional Wealth is rooted in the study of family firms,which is also best interpretation of the heterogeneity of family firms（Gomez Mejia et al.,2007）.What makes family business strategic decisions special is that decision-makers not only consider economic goals,but also take social emotional wealth（SEW）,a non-economic goal,as a reference point for decision making.If a strategic decision threatens the family’s existing SEW,family decision makers would rather choose to give up（Zhu et al.,2016）.Family control is an important dimension of social emotional wealth,and the risk aversion preference of family control plays a dominant role in investment decisions.In the balance between corporate growth and maintenance of control,most family firms choose to give up growth to prevent the dilution of control（Chen et al.,2013）.Merger and acquisition activities are highly uncertain,and the loss of family business reputation caused by M＆A failure will also lead to SEW loss,so the decision makers of family business are emotionally unwilling to carry out M＆A activities that may bring risks to the enterprise or threaten the survival of the business（Caprio et al.,2011;Shim＆Okamuro,2011）.However,to get a deep understanding of family business behavior and decision we need to take into acccount the specific economic and social environment where they were born.Chinese family firms are faced with different market and institutional environments at the very beginning,so the theories and conclusions of western family enterprises may not be applicable to China.The average family shareholding ratio of American family listed companies is only 18.11%（Anderson＆Reeb,2004）.However,based on the data of Chinese A-share family listed companies from 2007 to 2019,the average family shareholding ratio of this study is as high as 38.45%,and the proportion of family control in even higher.Compared with foreign family business,family firms in China are relatively young.Unlike Japan and Germany family businesses’focus on its main business,Chinese family firms exist diverse endogenous preference,in order to realize the family companies built to last for the target（Luo et al.,2021）,may show a higher willingness to mergers and acquisitions（Liu Bailu＆Lv Changjiang,2018）.It is held that Chinese family firms are still at the stage of growth,faced with the fierce external market competition and the pressure of internal family intergenerational inheritance,M＆A is an unavoidable strategic decison family firms need to adopt.Based on the theory of SEW,family firms carry out fewer mergers and acquisitions in order to maintain family control and avoid risks.Based on the sustainable development hypothesis,family firms take long-term goals as their orientation,with no fear of the pressure of short-term performance,and seek the external development of enterprises.In combination with China’s private economic development practice and capital market M＆A,family enterprises that grow in the gap also have the idea of taking the lead.They use information advantages in the market to tell stories through M＆A to raise stock prices and make short-term arbitrage.Therefore,there is no lack of interest usurping motive of M＆A initiation.Based on 2007-2019 data of Chinese private listed firms from China A-share research,comparing the family business and the family enterprises in whether M＆A behavior decision-making differences and M＆A can create value for enterprises,the study found that compared with the family business,Chinese family enterprises implemented more mergers and acquisitions,based on the motivation of M＆A,in-depth investigation,The stronger willingness of family firms reflects the benefit expropriation effect of family control.The positive relationship between family control and M＆A is more prominent in family enterprises with more internal capital occupation,controlling shareholder pledge,poor external institutional environment and non-big Four auditing.Compared with founding control,non-founding control family enterprises initiate more M＆A.Family firms have strong m＆a intention but poor M＆A performance,which further verifies the benefit taking hypothesis of family M＆A motivation.Ownership structure arrangement is the starting point of corporate governance.In the case that the controlling family has a dominant share,although the family enterprise has a strong intention of M＆A,the m＆a performance is poor,the overall M＆A efficiency is not high,and even value-destroying M＆A will occur,which directly threatens the survival of the enterprise and the healthy development of the capital market.Existing studies have proved that in deepening the reform of mixed ownership,the integration and effective checks and balances of capital with different property rights have become an effective means to enhance the core competitiveness of various economic entities including family enterprises（Luo Hong＆Qin Jidong 2019;Du Shanzhong,2021）.Based on the background of deepening the reform of mixed ownership,this paper makes an in-depth study of the influence of state-owned equity participation on the efficiency of M＆A of family enterprises.The study finds that introducing state-owned equity into family enterprises can make the m＆a activities of enterprises "do less but better",that is,reduce the possibility of launching M＆A and reduce inefficient M＆A.However,it increased the selection of the selected M＆A target,the management and control of the M＆A process,and the optimization of M＆A integration,and finally achieved a higher M＆A performance,showing the improvement of M＆A efficiency.Further research shows that state-owned equity participation on the efficiency of family enterprises M＆A is more significant in the internal capital occupation,the presence of controlling shareholder pledge and poor external institutional environment,non-audit four enterprises;The governance effect of state-owned equity participation significantly reduces related M＆A within family firms.State-owned equity participation can improve the performance of family enterprises M＆A mainly through two ways:reducing the M＆A premium and improving the ability of M＆A integration（enhancing the level of internal control of family firms）.The extensive research also found that state-owned equity participation is not only a form of equity participation,but also has a substantial right of speech.State-owned equity has a more significant board governance effect,and the appointment of directors by state-owned shareholders can further optimize the decision-making and improve the efficiency of M＆A of family enterprises.The dessertation tests the governance effect of state-owned equity participation from the perspective of family business M＆A and argues that the exist of different types of shareholder can serve as an effective monitor for controlling shareholders of family business.It provides options for the family business on how to improve corporate governance of family business.It has been proved that mixed ownership reform can improve business decision-making efficiency and a way to become great enterprises. |
PDF Full Text Request