Governance Factor Motivation Behind M&As Of Listed Companies In China

We studies the motivation behind M&As of listed companies in China from a special point of view: corporate governance and market-system structure. Due to the complexity of the securities market system structure and the ownership structure and agency relation in listed companies, we believe the most important motivation promoting M&As in listed companies in China is the factor from corporate governance. Hence, we put emphasis on the study of behavior tendencies, benefit resources and return degree of three kinds of insiders-large block-holders, informed traders, managers-in the M&As process of listed companies. Through empirical analysis and market-accounting method tests, we find there lies a possibility for the insiders mentioned above to gain abnormal private benefits in the process of M&As. Therefore, we suggest that it is no other reasons but the benefits pursuing and benefits deployment structure impel the active M&As in listed companies.According to theoretical analysis and empirical tests, we conclude that currently in China, the faultiness of market system and corporate governance, which lies in securities market, is the vital reason and special system background of many unefficient M&As in our listed companies. In order to regulate and optimize the M&A behaviors of our listed companies and improve the efficiency of M&As, it is necessary for the authorities and monitors to optimize the ownership and governance structure, improve the legal system and monitoring efficiency on securities market and provide more effective policies for monitoring efficiently.