The Compensation Commitment Of Major Shareholders And The Interests Protection Of Minority Shareholders

In listed companies under common control mergers and acquisitions, in order to protect the interests of minority shareholders of listed companies, the CSRC stipulate major shareholders of listed companies for compensation commitment to the future performance of the underlying asset. In practice, whether compensation commitment of major shareholder protects the interests of small shareholders. In this paper, the case study as method of analysis.In this paper, based on three cases from machinery and equipment industry, it use the method of financial indicators and cumulative abnormal return, it study compensation mode, period and compensation measures to protect the interests of small shareholders effect.The results showed that:Cash compensation, stock repurchases and shares given all can motivate major shareholder to strengthen the management level, improve the viability of the target company and financial situation, to protect interests of small shareholders in the short term; Stock repurchase and cash compensation mode is declared, the company’s share price has greatly decreased, cumulative abnormal return is negative. It suggests that the benefit of shares give compensation is greater than the share repurchase and cash compensation, shares give compensation mode is most conducive to protect the interests of small and medium-sized investors, and share repurchase plan is better than that of cash compensation; The longer the period for acceptance, the better to protect minority shareholders interests; Compensatory measures failed to effectively protect the interests of small shareholders; Accounting treatment against the potential investors (minority shareholders) of interest.