The Allocation Tendency Of Controlling Right And M&A Performance Of The Target Firms

M&A performance is affected by multiple factors in the process of company’s mergers and acquisitions, in which the post-integration of target companies after mergers is a key factor that affects M&A performance. On this basis, focusing on how to configure the control rights of target companies during the course of M&A, this paper examines the possible impact on M&A performance when different configuration tendencies of the control rights of target companies to the controlling shareholders, board and management level occurs.This paper combines the research method of normative analysis with empirical analysis, selects219listed companies with merger occurrence in2009as samples, takes accounting performance indicators in2009-2010as the object of study and makes empirical analyses on the influence of configuration tendency of control rights of target company on the M&A performance after mergers.In the normative analysis, this paper summarizes the relevant research achievements of the relationship between the three aspects of the shareholder structure, board structure and management structure and the company performance, analyzing the relevant theories of control rights configurations and proposing hypothesis on this basis.In the empirical analysis, this paper validates the relationship between the different configuration mode of control rights from the shareholder level, the board level and the management level and the M&A performance. The study has found:(1)The tendency to configuration mode of control rights to on the shareholder level has a significant impact on M&A performance. The strengthening of the control rights over the target company by the largest shareholder can effectively improve the business performance of the target company, thus facilitating the target company out of the integration situation as quickly as possible.(2) The role of tendency to the configuration mode of control rights on the board level is obvious in the merger integration of target companies. The board size has little effect on M&A performance, while the proportion of independent directors positively correlated with the M&A performance.(3)The mode of tendency to allocate control rights by management class and M&A performance are negatively correlated. In the context of merger integration, the internal environmental instability of the target company causes management class to generate self-preservation trends, which affects the overall operations and long-term performance of the target company.The results show that there is significant difference about the impacts that configuration tendency of control rights of target company on the target corporate performance between the stable environment and the merger scenario. Under the merger scenario, the tendency to the shareholders under the configuration of control rights can effectively improve the target company’s performance; but in the case of traditional corporate governance, the allocation of control rights to management is more conducive to the improvement of corporate performance.This conclusion provide a theoretical and empirical support for the acquirer take targeted configuration mode and dynamic regulatory measures when the target company in the integration phase. At the same time, this study recommends the acquirer to take dynamic mode of control rights allocation according to the operations, corporate performance and the ability of managers in target companies to achieve the transformation from the management mode to the governance mode.