Empirical Analysis On The Relationship Between M&A And Corporate Governance In Chinese Capital Market

The main goal of this paper is to confirm that whether the targets of M&A in the capital market of China are characterized with bad performances and inefficient corporate governance, whether the motivation of M&A is to improve corporate governance, whether M&A can improve the targets' corporate governance.There are five chapters totally.Chapter one discuss the aim of the corporate governance, point out that the aim is to solve the agency problem, introduce that there are two mechanisms to solve this problem, one is internal control mechanism, the other is external control mechanism. The market for corporate control plays an important role in the corporate governance as an external control mechanism, and M&A is the most efficient way to solve the agency problem.Chapter two explicates correlative theories of the relation between M&A and corporate governance. First, we makes a research of the history of M&A in the west, then we mainly introduce relative studies on the relationship between M&A and corporate governance, from that we know M&A can identify corporations with governance problems, and the corporate governance can be well improved after transformation of control right, and the potential M&A can supervise the managers as a good external control mechanism.Chapter three introduces theories about M&A happened in the capital market in China and shows us the status of corporate governance of Chinese corporations. These theories mainly focus on the performance of M&A and the response of the capital market, and the status of corporate governance can be summarized as "inefficiency of internal control mechanism and undergrowth of external control mechanism."Chapter four is the most important one in this paper. In this chapter, we make an empirical analysis on the relationship between corporate governance and M&A happened in capital market in China. We select two kinds of corporation in capitalmarket, one kind have a transformation of control right in 2002, and the other have no transformation. We select 11 indexes to represent corporate governance and compare each index of two kinds of corporation through average analysis. Then we use factor analysis to compare their corporate governance. The result is: the corporate governance and the performance of corporations which have a transformation of control right are worse, the performance become better after transformation, while the corporate governance become worse.Chapter five explicates the results of empirical analysis and generalizes four innovations in this paper, also point out shortages in the study.