Performance Study Of ST Company Based On Strategic Motives Of Reorganization

ST companies urgently seek turnaround possible when they facing delisting risk and dilemma. Reorganization of assets has played an important role in the inventory of public Division of assets, and enhance the core competitiveness of the company.Also,It works rapidly.Thus It is important choice of ST companies. But whether all of the assets reorganization can help bailing out and rebuilding the companies' core competencies of ST cause doubtful.there are many factors which affecting the performance of ST's asset restructuring. this paper focused on the relation between ST's strategic motivation asset and performance of reorganizationIn this paper, The major research methods is standardized analysis and empirical analysis.The samples are the reorganization of ST companies which occurred in China A-share market in 2006 and2007,we studied the relation between strategic motivation of restructuring and re-performance from market performance and financial performance.In the section of standardized analysis,the first,we sorted the research about strategic motivations and performance of asset restructuring. The second,we systematicly reviewed the theory related to motivation of the company's strategic asset reorganizationIn the section of empirical analysis,we studied the relation between strategic motivations and performance of asset reorganization about ST companies.In the aspect of Market performance,we choose 10 trading days before and after the re-notice as the window period, using excess earnings method to calculate excessing returns of the sample in the event window period,and doing statistical analysis,,the results showed that:the strategic reorganization of the company's assets motive of ST has a significant excess returns, but also in the window period, the cumulative excess return has a sustained growth. assorted strategic motivation restructuring, The restructuring of changing the main business has maximize excess returns, followed by the reorganization of the pursuiting synergies.In the aspect of Financial performance,we build four sorts sand ten financial indicators to examine the financial situation of ST companies in the year before the reorganization, restructuring year, three years after the reorganization,The research shows:The ST companies' financial performance has significantly increased in the restructuring year and after the first year of reorganization,but a sharp decline in financial performance in the second year after the reorganization,and backing to the original high again in the third year after the reorganization. Horizontal comparison of the category about Strategic reorganization shows:the pursuit of synergies performance has the most significant financial motivation, followed by restructuring motivation of changing the main business, once again stripping the reorganization of low-quality assets, the fourth motive is the pursuit of the size,and the finally is the restructuring motivation of pursuiting diversity.According to research findings, this paper proposes the following recommendations:First,ST companies should establish a strategic motivation of reorganization, especially to encourage motivation of changing the main business and the pursuit of synergies; Second. ST companies should pay attention to the integration after the reorganization; Third, the government should strengthen regulating restruction of ST corporates, guide corporate restructuring reasonably.