The Empirical Research Of The Relationship Between The Listed Companies Guaranties With Associated Party And Companies' Value

In recent years, listed companies increasingly provide financial guarantees, which led to bad results to companies's operating performance and the entire capital market. This essay focus on this phenomenon and also take account of the proportion that control stockholders stocks. This essay will use empirical pool-data analysis based on 2000 to 2007 years and will analyse:1. For listed compnies, whether the behavior of providing guaranty to relevant associated party will decrease their value. And if it does, to what extent.2. For listed compnies, whether the behavior of receiving guaranty to relevant associated party will decrease their value. And if it does, to what extent.3. For listed compnies, whether the worst behavior-providing as well as providing guaranty to relevant associated party will decrease the their value. And if it does, to what extent. The analysis results show that, for all the three behaviors above, the times of associated party's guaranties have a negative relationship with firms'value. the firms'value of providing as well as providing guaranty are the lowest, followed by receving associated party's guaranty and then providing associated party's guaranty. What is more, based on 10% Significant Level, the share keeping proportion of the biggest share holders have a U style relationship with firm's value.