An Empirical Study On The Payment-Method Effect In Merger And Acquisition Of The Listed Companies In China

This thesis selects merger and acquisition(M&A) events of Chinese listed companies in 2001 as its research object, classifies those events into several groups according to the payment method and their active or positive role in M&A. By means of event and comparative study, the thesis analyzes the impacts on financial and market performance of listed companies by the different payment methods in M&A and discusses the correlation between the above two kinds of performance.The following results have been drawn in the end of the thesis: (1) In cash acquisitions, the abnormal returns to the shareholders of target firms are positive and significant while the shareholders of bidding firms can only get normal returns. (2) Insignificant is the difference of the post-acquisition financial performance among the sample groups. So is the difference of market performance between the groups of target and bidding firms in which different payment method are applied. (3) There is no correlation between market performance and financial performance, which indicates that the investors have little appropriate anticipation on the worth of the events in M&A.Based on what is studied above, it is also suggested in the thesis that financial innovation should be promoted and a sound legal system provided.