Study On The Financial Performance Of The M&A Payment-method For China's Listed Companies

In the 21st century, Chinese nation-owned companies are facing the further innovation determining their fate. The innovation mainly includes the following contents: changing out-of-date mechanism, exerting advantages in comparison and achieving internationalisation. These three innovations all closely relate with the most advanced merger&acquisition (M&A) manners in the era. Changing mechanism utilizes Management Buy-outs (MBO); conformity utilizes strategic M&A; and internationalisation utilizes M&A with foreign capital. Obviously, M&A is the highlight of these three innovations. It's the accelerator for the development of market economy .As the key part of M&A, choosing payment-method has become a very important issue, and great importance has been attached to it in the same time . After the purchaser has made the decision to M&Aits goal company, it becomes a very important question that which payment toolshould be adopted to gain that company's assets or stocks. different M&A payment-methods differently affect the financial performance of both side, and is not only related to the achievement of M &A strategy , but also determines the cost , even success of M &A .In general, there are following payment manners of M&A: cash payment manner, stock payment manner and integrative securities payment manner. Cash payment manner is the main payment manner, occupying the largest proportion. The next is stock exchange manner. And fixed income security payment manner only occupies a very small proportion .This paper discusses the related basic theory of M&A and the payment-method , compares the payment-method used by our country and the international , on this basis, making the listed companies' M&A events during 2006 to 2008 in china as the research object , and using asset-liability ratio, earnings per share, and return on equity as studying indexes, this paper make use of the empirical method to test how different payment-methods for listed companies in china affect the post-acquisition financial performance significantly .The results show that in long run cash and stock payment-methods have negtive influences in financial performance , but this influence is not significant ; other pay-ments have active influences , and this paper explains the conclusion . Finally, this paper presents some suggestions to perfect the M&A payment-method for China's listed companies . Based on the gradual perfection and development of capital market and M&A market,and the deepening reforme of economy and politics , this article also looks ahead to the M&A payment-method for China's listed companies .