Effect Of Payment Method On M&A Performance Of Listed Company-From Evidences At DifferentStages

As an important way to achieve extensive growth, M&A behavior has been given wider concern on improving enterprise innovation capacity and strengthening enterprise competitive capacity. At present, M&A has become a hotspot in practice circle and academic circle. There were many influential factors in value creation with complex mechanism in M&A process. As an important link in M&A process, the payment method has crucial effect on M&A performance. Therefore, how enterprises design payment scheme according to its practical situation and how supervision department manages M&A behavior according to the market development have become rather important.This paper found through the theoretical analysis on effect of payment method on performance at different stages after M&A that the stock payment was superior to cash payment in a short or rather long period. Based on the theoretical analysis, this paper took M&A behaviors of list companies in Shanghai and Shenzhen from 2009 to’ 2011 as the research samples to construct the comprehensive performance function before and after M&A and calculate the performance of every M&A enterprise via factor analysis method by combing the financial index data in CSMAR. Further, the multiple regression method was adopted to verify the effect of payment method on M&A performance by controlling the variables such as the largest shareholder proportion and connected transaction etc. The research found:(1) most of M&A behaviors of listed companies in China did not bring out improved but reduced performance in a short and long period; (2) the stock payment can better improve M&A performance in a short period than cash payment, while those two payment methods did not have significant difference in a rather long period; (3) the higher proportion of the largest shareholder means the higher ownership concentration of acquirer and better M&A performance at different stages; (4) the relatively large transaction scale can improve M&A performance in a short and long period. Therefore, aiming at the current status dominated by cash payment in China, the related administrative department shall gradually relax the stock issuance and verification system at the time of M&A and enrich the payment methods in M&A process. More importantly, the enterprise shall clarify the M&A motivation and participate in market M&A actively to expand the enterprise scale and strengthen the enterprise strength.