Research On The Performance Of Foreign Capital’s M&A Of Target Companies Listed In Chinese Shanghai Or Shenzhen Stock Market——Based On Binary Relative Evaluation

With the advance of the process of China’s economy internationalization, China domestic merger and acquisition (M&A for short) market has been rapidly developed, foreign capital’s M&A is active. Taking micro-level M&A performance as research perspective, this paper makes an empirical study on the performance of foreign capital’s M&A to companies listed in Chinese Shanghai or Shenzhen stock market.On the basis of refering to M&A theory and previous studies, this paper selects fifity foreign capital’s M&A cases completed in2003-2009as research samples, and applies binary relative evaluation method which is based on factor analysis to analyze the effect of foreign capital’s M&A on sample companies’operating performance and management efficiency by comparing the change of sample companies’operating performance and management efficiency in the year before and after the completion of M&A. Besides, it also analyzes if different related factors, such as M&A means, related M&A or not, mergering companies’regions, majority ownership position, would significantly affect the sample companies’operating performance and management efficiency.The results indicate that, in terms of operating performance, foreign capital’s M&A will help to improve the operating performance of the target companies, but it is hard to sustain; in terms of management efficiency, foreign capital’s M&A has limited effect on the improvement of the target companies’management efficiency, and in the long term, it could make the target companies’ management efficiency even worse; Besides, during the M&A related factors’ contrast analysis, no matter operating performance or management efficiency, different sample companies do exist difference, but the difference is not statistically significant.