The Research Of Corporate Governance On Cross-border M&A Performance In The Perspective Of Institutional Investors

The cross-border M & A has already substituted the greenfield investment becoming the major method for the domestic enterprises to enter overseas market and improve their competitive edge. The advantage is that it enables the enterprises to overcome the limitation of self-development and to expand rapidly as a whole, as well as to obtain strategic resources in the meantime which is beneficial for enterprises to optimize their industrial structure, in order to realize effective allocation and rational flow of resources worldwide in the end. However, cross-border M&A not only has financial risks, but also faces the operational risks and integrated risks once the merger has made, which lead to low rate of success of cross-border M&A in China. Studying on cross-border M&A performance can help the domestic enterprises undergo M&A effectively.This paper tried to doing researches by selecting 111 enterprises, which succeeded in cross-border M&A in A-shares in Shanghai and Shenzhen Stock Exchange during the period from 2008 to 2012, as the research object on the basis of researches that academia has made. This paper used factor analysis as well as multiple linear regression model to do empirical research. Firstly, this paper selected from three aspects of the elements of corporate governance to obtain corporate governance rating index-G index by factor analysis, and used factor analysis to build cross-border M&A of listed companies' performance evaluation system. The regression equation was to test the relationship between corporate governance and performance of M & A, which was built by taking M&A performance as the dependent variable, the corporate governance rating index G as independent variables. Secondly, this paper studied the regulation of institutional investors in corporate governance and cross-border M & A performance. At last, to have a further in-depth study, this paper classified the institutional investors into the potential active institutional investors and potential negative institutional investors to discuss the regulation of different types of institutional investors. The results showed that:the higher the level of corporate governance, the better the performance of the company's cross-border M & A; institutional investors has a positive effect on corporate governance and cross-border M&A relationship. With respect to negative institutional investors, the potential positive institutional investors has a stronger impact on corporate governance and cross-border M&A performance.The institutional investors have played a positive role in terms of corporate governance, dividend policy and the protection of minority shareholders' interests as they expand in number and size rapidly. China's capital market has entered the era of institutional investors, this article introduced institutional investors into the research of cross-board M&A performance, not only provides a theoretical support for China's cross-border M&A activity, but also provides a reference on how to guide institutional investors to participate in corporate governance.