Analysis On M&A Performance In The View Of Transaction Of Controlling Right In Listed Companies

Under the background of world economic integration and globalization, mergers and acquisitions, as the important link of optimizing the share structure and resource allocation of stock assets, is a long-last topic studied by scholars all over the world. In recent years, with the development of the M&A market in our country, how M&A affect the corporate operational performance is becoming a hot issue for study. Merger and Acquisition activities between enterprises in our country began in1984, and listed companies began in1993,"Bao Yan storm". After that, the scale and scope of Merger and Acquisition activities is increasing quickly. Data from Zero2IPO Research Center showed that between2008and2011, Chinese M&A market completed as many as2088M&A events, the amount of up to$169.408billion. Among them, Chinese enterprises from domestic completed as many as1384M&A events, the amount of up to$89.445billion. Manufacturing industry, as a pillar industry of China’s national economy, its M&A activity has always been on the top in the latest years. In particular, the introduction of the national12th five-year plan, make manufacturing industry in our country into a profound strategic restructuring phase. On the other hand, the transfer of controlling right of listed companies in our country changes and develops in the particular capital market and policy environment. Compared to the development of Europe and other developed countries is relatively young. With the proportion of controlling right transfer(CRT) in M&A is growing, the research about whether the transfer of controlling right will help improve the company’s performance, whether the way of controlling right transfer will affect listed companies performance, whether the relevance of transferor and transferee have influence on performance of M&A companies is becoming increasingly important.This paper expounds the theory and empirical studies. From the perspective of CRT, this article makes research on the M&A performance of the target corporation. Specifically, the study includes three main respects:firstly, the effects on M&A performance caused by two different results of M&A behavior; secondly, the effects on M&A performance caused by various ways of CRT; thirdly, the effects on M&A performance caused by profession relevance of the two sides in M&A.First of all, this article describes the relevant research background, finds the problems and summarizes the theoretical and practical value of this topic. Secondly, it reviews and combs the domestic and abroad research on the M&A performance and its relations with CRT. It also stated the current situation of the research. The third part mainly elaborates the basic theories of CRT and M&A performance, including definition of related concepts, like M&A, M&A performance, control right and CRT; classification of M&A and CRT; basic theories of CRT and M&A performance, the fourth part puts up the hypothesis based on the study about the related theories:the M&A performance of the control right transferring corporations is better than the companies without transferring the control right; the paid transfer better than the unpaid; and the profession related better than unrelated. In the empirical analysis, take all the equity transfer events occurred in2008to2010in the manufacturing industry as the research sample, the study period is from2006to2012. By establishing the financial index system, using factor analysis method to construct the comprehensive scoring function, to calculate the average composite score of all kinds of samples, to the aforementioned assumptions one validation and draw empirical results.The empirical results show that transfer of controlling right of listed companies’ performance is superior to whose controlling right hasn’t been transferred, because the transfer of control right can be alleviated agency problem of Target Corp and improved operating efficiency, allows investors to re-evaluate the business value and establish good expectations of performance improvement, makes target company get more cash flow, which will help improve business performance; the performance of listed companies whose shares were paid is superior to whose shares were not paid, because the paid transfer, make investors more careful in the choice of the target company, and property rights can be more clearly defined under this kind of approach, encourage owners to improve management efficiency, which will help improve business performance; in the short term, industry-related M&A performance is superior to non-industry-related M&A, but it lack of long-term sustainability, because the industry-related M&A have more advantages in resources integration at the beginning, but since these samples contain a lot of unpaid transfer of state-owned share, make no changes in management mode, and lead to the lack of sustainability in improving operating performance.At the end of the paper, it describes the limitations and shortcomings in this study, and points out the direction for further study. Finally, puts forward some suggestions, for example, reduce government intervention, improve relevant laws and regulations, be more careful in selecting the target companies and so on.