A Study On The Influencing Factors Of M & A Premium Of Listed Companies In China

Price is one of the factors influencing people to make decisions in a market transaction, as a comprehensive indicator reflects the market, when people are buying goods, both the value of the commodity and the price need to consider. The price of goods whose value fluctuates around, when paying top dollar, to create a premium. At this point is to get the value of goods, but not conducive to the interests of the buyer. Interpretation of traditional finance theory for M&A is that Mergers and acquisitions for the company to bring the management, financial and operational synergies can reduce the average cost of an increase in operating income, but whether synergies can bring the desired results there is uncertainty. Prediction of things to come, because not decided based on a single factor, faced big risks, coupled with the high price paid relative premium, two areas where the impact is not conducive to the acquirer.There are many factors affecting the acquisition premium, in order to be able to cognitive systems acquisition premium, from the theoretical level to construct a framework needs to be analyzed. Based on behavioral finance theory point of view, from the perspective of people’s investment decisions, with listed companies as acquirers, according to behavioral finance theory to construct a framework for merger analysis, based on three components to analyze the causes of influence corporate decision-making. These three parts are: the impact framework of the target company, the acquirer company’s decision framework and the impact of merger and acquisition stages framework, then go through this three-part analysis of reasons affecting the acquisition premium, and find data to prove the impact factor. After merger- related data collected in our country listed company, using multiple regression methods and Descriptive Statistics analysis, concluded that 1.for the target company’s overly optimistic of the industry were the main factors of the acquisition premium is raised, 2. Under the influence of mental accounting, extra proceeds will easily form the acquisition premium, 3. Changes in the mechanism of decision-making of the Board of management of the company cannot have a remarkable impact on acquisition premium reduction.Based on the above conclusions of the analysis found that acquisition premium of listed company in China to produce more on intuitive inferred is reflected in the target company, corporate executives in the study of the target company shall be reduced optimism about the industry, concluded at the same time rich with a grain of skepticism helps reduce the acquisition premium.Based on behavioral finance theory toconstruct analytical framework of merger, through which the amount of deviation analysis of acquisition premium, providing help to subsequent acquisitions.