Management Buyouts, Research, And Governance Performance Of Listed Companies

This paper mainly studies that management buyouts (MBO) affects corporation governance in China. Its train of though is as follows: At first it explains the relationship of MBO and corporation governance merits in theory, and investigates overseas MBO and corporation governance merits under the influence of MBO; Establish the mathematical model and research relationship of MBO and corporation governance merits in China. Finally, we can draw conclusions.Study results show that, when listed companies managers will hold the shares of less 4.41% in China, the managers align oneself with the external stockholders, managers' stockholding will be in direct proportion to corporation governance merits. If the managers' stockholding ratio range from 4.41% to 32.88%, MBO will intensively be interrelated to corporation governance merits. Provided the managers' stockholding ratio is increased, the managers' on-the-job consumption and the agent costs will be reduced, and corporation governance merits will greatly be raised. But if the managers' stockholding ratio is more than or equal to 32.88%, the increasement of the managers' stockholding may raise the agent costs and entrench upon external stockholders.The average of the managers' stockholding ratio is 8.30% in the listed companies of MBO in China, is far less than 32.88%. It is illustrated that the listed companies of MBO may put into effects on MBO once more. And the managers' stockholding ratio is more than 32.88%, the paper suggest that the companies must not execute MBO.The paper makes innovations in many aspects. Explain the relationship of MBO and corporation governance merits in theory; Draw on the experience of overseas MBO, establish the mathematical model and research correlation of MBO and corporation governance merits in China.