The Analysis On The Efficiency Of The Acquiring Firms In China's Securities Market

Merger & Acquisition (M&A) is a business method for corporations to expand and restructure by getting other assets' ownership or equity-control, and it is expected to optimize M&A firms' resource distribution. China's stock market is gaining more space along with the deepening of reform policy and expeditious development of economy. Simultaneously, more and more listed companies adjust the industrial structure and optimize the resource distribution by M&A. So, what's the effect of M&A in China's security market? And have such companies got the excess increasing by M&A? The investigation will be propitious to realize market-oriented and material M&A in China. The paper comprises five chapters. At first the background and train of thoughts of the research are described in the introduction which also summarizes the foreign and domestic empirical studies of relative issues; Secondly, the paper introduces the theory of M&A and the effect of M&A on the company's efficiency is analyzed based on the relative theory which provides a theoretical basis for the latter empirical research ; Chapter 4, as the core of the paper, describes the development of listed companies' M&A in China, confirms the period of M&A samples chosen in the paper, and conducts an empirical investigation into the performance of M&A using the model built on the Financial Indexes Method; Finally, the impact of different M&A patterns and equity compositions on M&A performance is analyzed. The results of the research suggest that most of the primary acquiring companies have improved their efficiencies after M&A and got a better performance than that of the industry they belong to respectively. And a positive kurtosis is achieved after one-year integration, the performance in the second year after M&A is best. Among the three M&A patterns, the vertical is most significant, that of the mixed M&A presents positive but not significant, and the parallel M&A pattern has a negative relationship with the effect of M&A, and the longer the interval of the sample gets, the more significant the relationship becomes. As a result, we need longer-period samples to verify its effect. In the equity composition research, we discover that the circulating-equity-dominant companies perform better than those mainly cover uncalculated equity. And the proportion of state-owned equity to the whole shareholding equity is most positive-relative to acquiring companies' performance, and the proportion of corporate equity follows on the heels of it. And the incensement of the proportion of both sorts of equity to the whole shareholding equity is advantageous to corporations' improvement of business achievement. But the situation of the state-owned equity proportion to the whole shareholding equity is just the reverse, it presents negative relationship with companies' performance after M&A, and the incensement of it will do harm to acquiring companies.