| With the rapid development of economy, more and more M&A cases happened. Mergers and acquisitions, can reconfigure social resources, reshuffle the industry, establish new order of the industry. When a company’s internal expansion already cannot satisfy the requirement of its rapid growth, in order to seek a bigger development space, company will take to achieve the goal of external expansion by merger and acquisition. Through mergers and acquisitions, the enterprise can obtain the new production technology and manufacturing process, also can learn the advanced management idea. In the history of the company’s development, almost all the giant companies are relying on the form of mergers and acquisitions to achieve development and growth to a certain extent.How big is the contribution Mergers and acquisitions bring to an enterprise? I believe that every man has a different answer. In recent years, with our country’s economy growing, the domestic company is not satisfied with the domestic market, and start to look for growth in the global range. But in the process, we saw many unsuccessful M&A events, such as SAIC acquired Korea SsangYong failed integration, TCL failed acquisition of Thomson’s television business. Mergers and acquisitions, to these companies of rapid expansion, it is like Pandora’s Box, no one knows what it will bring to the acquiring company. Despite the growing number of companies on mergers and acquisitions, but we will have a question, whether the acquisition will give the company’s improved performance, what kind of company is more likely to succeed in mergers and acquisitions.Foreign scholars began a study of mergers and acquisitions in the middle of the last century.And now, the academic research on mergers and acquisitions is so many. Whether acquisitions can improve the performance of the enterprise, foreign scholars have no consistent conclusions. Some people think that acquisitions can bring positive benefits for the shareholders of the company, also some people suggested that the acquisition will bring negative returns, and some even believe that most merger is a failure negatively. Later, what led to the success or failure of mergers and acquisitions attracted the interest of the scholars, the study of mergers and acquisitions turned into the influential factors of M&A instead of performance. Through extensive research, they found that the mode of mergers and acquisitions, payment, cash flow, relative size and other factors will affect the performance of the M&A. But in the research process of foreign scholars, selection of samples, research methods and measurement of the performance are not identical. So Their studies are not comparable, the representative is not strong enough. There are many uncertain factors which would influence M&A, the external environment or different indicators can lead to differences in the results of the study. As the pioneer of researcher on mergers and acquisitions, Foreign scholars provide us a lot of guidance, let us have the idea and direction of research on mergers and acquisitions.Beginning in the1990s, under the impetus of China’s rapid economic development, M&A activity between enterprises have gradually become active. Domestic research scholars will also start to focus on the research of M&A events. Modeled on research methods of Western scholars, Chinese scholars began to study China’s M&A events. However, the development of China’s securities market is not long enough, so there are few research samples can be obtained, which restricts the domestic research on mergers and acquisitions to a certain extent. There are two kinds of research methods about m&a performance, accounting method and event study method. However, due to China’s securities market is not a sufficiently standardized system, there are still a lot of false information and insider trading. So whether the accounting indicator in the financial statements of listed companies, or companies’ fluctuations in stock prices, its credibility has been affected by a certain degree of doubt.Nevertheless, the research findings of scholars in China still have great reference value. For the particularity of our political and economic system, in the process study, Chinese scholars also added a lot of factors that foreign scholars did not realized, and draw a lot of useful conclusions. For incentives to mergers and acquisitions, Chinese scholars believe that government action, speculative asset reorganization and backdoor listing takes up a large proportion. In terms of influencing factors, they found that the political association, ownership concentration, executive power and so on had a great influence for the performance of mergers and acquisitions.This paper studies the performance of mergers and acquisitions of listed companies in China and the factors affecting the performance of M&A. In order to ensure the representativeness of the findings, the study sample of events selected in this paper span the decade2004-2013.At the same time, the definition of M&A in China is too broad, and there are too much assets reorganizations in domestic M&A events. This article only selected the M&A events that take equity as the subject matter as sample, in order to ensure the motives of M&A are based on strategic expansion of the enterprise.This paper use event study method to examine the shareholders’cumulative abnormal return of acquired company after M&A events occurred, to measure the short-term performance of M&A. This article selects the estimation window as (-160,-11), the event window as (-10,10). By significance test of accumulative abnormal return, This paper argues that the acquisition events will bring significant positive cumulative abnormal return to the shareholders of the acquired company. And the cumulative abnormal return is most significant in the time period of (-2,1). In the time period of (-2,1), the shareholders of the acquired company can get the maximum cumulative abnormal returns, an average of3.7%, and then gradually decline.Then, based on the expectation theory, this paper put forward assumptions in view of the influence factors of M&A performance. Before M&A occur, the company with good performance will be sought after by investors, the stock price will rise after the merger, the short-term performance will be improved. The measure of the performance is mainly from the profitability, development ability, the cash flow ability, operation ability, risk control and debt repayment ability five aspects to select indicators. Selected indicators are return on assets, capital preservation increment rate, cash flows per share, asset turnover and asset-liability ratio for a long time, financial indicators are taken from the previous year’s financial statements. After using multivariate regression model analysis, this paper draw the conclusions as follow:Cash flow ability, operating capabilities, risk control and solvency are positively correlated with the performance of M&A, profitability and development capabilities is negatively correlated with the performance of M&A. In the control variable, the relative scale, is positively related with M&A performance, using cash payment is negative correlated with the performance of M&A. This paper argues that the possible reason is that the company with high profit ability and development ability was originally a high quality of investment projects for investors, but it introduced the risk of uncertainty after the merger, so will be abandoned by the investors. |
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