Research On The Relationship Between The Listed Company's M&A Performance Commitment And The Company's Valuation

In recent years, mergers and acquisitions have been frequent. And as an innovative trading arrangement, M & A performance commitment has become the focus of investors' attention gradually. At the time of a major reorganization and acquisition of listed companies, what impact do the performance commitment made by the largest shareholder to investors have on the valuation of the company? This is the main line of logic discussed in this paper. Based on a comprehensive research on previous scholars, we analyze the relationship between M & A commitment to performance and company valuation from a three-dimensional perspective. The first is a short-term perspective, using the event study to calculate excess cumulative rate of return during the period of window stock merger announcement, and to compare the strength of market response to the performance that listed companies commit. Then, the introduction of M & A characteristic variables in the regression model tries to explain the merger under different background characteristics, the performance of short-term commitment on the listed company's share price. The second is a long-term perspective, the company valuation theory pricing models and revenue model is based on the commitment to discuss M & A performance of listed company's share price and the rate of return on equity, that is, to discuss the performance impact on the company's valuation. Through model analysis, we get the following conclusions:1. In a major restructuring mergers and acquisitions, the largest shareholder who make commitment to performance ratio make the company's short-term stock price greater and more lasting and have more positive impact than those who don't make a performance commitment.2. In a major restructuring mergers and acquisitions, the greater the size of the acquisition, the greater the impact of the commitment of the listed company performance made by the major shareholders on the listed company's short-term stock price will be, and the impact is positive.3. In a major restructuring mergers and acquisitions, the commitment of the company's performance made by the major shareholders of will have positive influence on the long-term valuation of listed companies.On the whole, when a major reorganization and acquisition of listed companies occurs, the commitment of the company's performance made by the major shareholders of will have positive influence on the long-term valuation of listed companies. Which is consistent with the current trend, that is the major shareholders are tend to make commitment to the performance of companies in today's capital market. restructuring have made the largest shareholder in M & A trends in performance commitments.This innovation point of this paper lies in the using of different models and perspectives when having a research on the relationship between the valuation of the company and M & A commitment to performance.The conclusion drove from every model supports each other. There are still some aspects that need to be further studied in this paper, one of them is the impact on the long-term and short-term evaluation of the result of the commitment to the performance of listed company.Thus making the discussion of this topic more comprehensive, and in an abundance angle, so that investors can be more objective on relationship between the performance of listed companies and M & A commitment.