The Impact Of Institutional Investors On The Performance Of M&A

Rapid development of our capital market and the national relevant policy support has created a good environment for China’s institutional investors, with the rapid development and become and important force in capital market, institutional investors governance effectiveness has become the focus of the scholars. However, merger and acquisition, as one of the important way of enterprise development, few scholars from this view to study the management of institutional investors. This article attempts to study the impact of institutional investors on m&a performance to examine the governance effect of institutional investors.Firstly, this article describes the definition of the relevant concepts and to sort out and comment on relevant literature; secondly expounds the basic theory, and then discusses the mechanism of institutional investors influence the performance of m&a. And on the basis of the proposed, expounds the research hypothesis. Based on the m&a events happended in 2011and2012, buyer company as the initial sample, after filtering and sorting, 263 samples are included. Measure the m&a performance using event study method and accounting study method. In order to measure the performance, the former calculated cumulative abnormal return after 15 days and 15 days before the merger, the latter mainly inspected the previous year to a year after the merger, namely between 2010 and 2012, the changes of financial index of buyer company. This paper selected eight comprehensive financial indicators for the three public factors and their comprehensive factor score was calculated using the comprehensive factor score performance measured by the difference of m&a.To empirically research assumption, get the following conclusions:(1)based on event study method, the study found that institutional investors and m&a performance is significantly positive related to the institutional investors, and the higher the shares of institutional investors hold, the m&a performance better, with the accumulation of extraordinary yield is higher. Institutional investors for the first big shareholder balance and m&a performance is significantly related to the balance of power, the bigger the power of balance, the better of the cumulative abnormal yields.(2)Under the accounting method, the research found that both institutional investors and the balance to big shareholders are significantly positive related to m&a.Finally, based on the conclusions, some countermeasures and suggestions are put forward in this paper, and pointed out the deficiencies and future research prospects.