Empirical Analysis On China's Private Listed Companies And Its Diversified Performance

When companies develop to a certain degree, diversification strategy becomes one of the most important problems of the enterprises. The third wave of mergers and acquisitions that happed in United States between 1950s and 1960s, made the level of diversification of American enterprises to the peak. And in the worldwide, corporate diversification had become more popular trend. The relations between corporate diversification and economic performance attract many economists, and became one most important research topics in financial field. For developed countries, they began to research the subject from the 20's century, have got some conclusion already.Scholars of our country began to research this subject in the 1980s. Because of the differences of the market and methods, there are some differences among the conclusion. The developed countries have already moved from carrying out diversification strategy to specialization strategy. Diversified listed companies in China still has a considerable proportion. In our country, there are more and more private controlled listed enterprises, which become more and more important in our country's economy. And the essence of them is like to foreign family controlled private enterprises. On this basis, the thesis use the methods from abroad and home, combining the present private controlled market of our country, giving the relationship research between the diversification and performance of the private controlled listed companies in our country. My research studying the impact of diversification to performance based on Chinese private controlled listed enterprises, have important theory and practical significance:at the theory, testing the applicability of foreign theory about the diversification discount and premium in our country; in practice, studying whether there is net earnings created by diversification in our private controlled listed enterprises.The thesis adopts norm and positive ways, and relying on positive mainly. Firstly, the thesis has a review about the related domestic and foreign literature, considering the particularity of our capital market and private controlled listed enterprises, and takes norm analysis. Then analyzed diversification status of China's private listed companies. The thesis makes a design, puts forward hypothesis and constructs relevant model. And lastly, in the positive analysis, the thesis adopts 129 private controlled listed companies from Shanghai and Shenzhen stocks market for the year 2005-2007 as the research sample. Collecting and choosing the data, designing the correlated variable and confirming the logic relationship of it. Regression analysis, comparison analysis and correlation are used to test the relation between diversification and performance.After combination the theory analysis and experienced test on the impact of diversification to performance, the thesis draws some conclusion:a negative relation is found between diversification and performance in our private controlled listed enterprises; the special enterprises have better performance than diversified enterprises; The thesis also made comparison analysis between related diversification and non-related diversification, and found that the related diversified enterprises have better performance than non-related diversified enterprises. Based on that, the thesis analysis the reason why diversification and performance are negatively correlated. One is that carrying out diversification can raise the performance, but in a long time, it needs new management capability, technology, human resources, but our private controlled listed enterprises often can't be satisfied the requests. On the other hand, China's private enterprises lack a reasonable employment system. At the end, thesis gives some suggestion about the diversification strategy that taken by our private controlled listed enterprise. Also gives the proposal for later research direction.