Governance Environment?Political Connection And The Efficiency Of Mergers And Acquisitions

With the development of global M&A market,China's listed companies are also trying to expand their territory through mergers and acquisitions to achieve its industrial integration,improve the company's core competitiveness,and fully participate in the global competition.According to incomplete statistics,China's capital market mergers and acquisitions transactions from 150 in 1997,the rapid development of 8380 in 2016,the transaction scale has also increased significantly.Mergers and acquisitions of Listed Companies in China for the development of more and more plays a vital role in mergers and acquisitions have gradually become an important field of research at home and abroad,and whether the merger can improve the efficiency of corporate management and create value for the enterprise,has been plagued by domestic and foreign scholars.The accurate measurement of the efficiency of mergers and acquisitions is undoubtedly an important prerequisite to solve this problem.China's capital market started late,especially in the background of the transition economy,which determines the unique characteristics of mergers and acquisitions of Listed Companies in china.The conventional enterprise merger efficiency measurement methods have some defects.This paper argues that only by using the DEA method to better respond to the efficiency itself has the concept of multi input and multi output,the measurement results obtained merger efficiency objectively and accurately.On this basis,this paper tries to study the impact of governance environment and political connection on the M&A efficiency of M&A enterprises.This paper adopts literature review,empirical analysis and comparative analysis method,comparative analysis of internal and external governance environment,the political connection of the state-owned enterprises and non SOE efficiency difference,at the same time,this paper further studies the role of internal and external governance environment on the relationship between different political connection and the efficiency of mergers and acquisitions.Firstly,this paper reviews at home and abroad on the acquisition efficiency,political connection,internal and external governance environment research literature,and combining with the principal-agent theory,rent-seeking theory,resource based theory and social network theory to analyze and put forward the research hypothesis.Secondly,based on the previous literature by selecting appropriate variable indicators and the assignment method to measure the political connection,select the "comprehensive index of external environment(All)" to measure the external governance environment in all regions,and from the equity characteristics,board of directors and the board of supervisors and management incentive three aspects were selected in 14 internal governance the evaluation index,establishing internal governance G-index to measure the level of corporate governance by principal component analysis,and regression model of the previous corresponding improvement.Again,based on the 2008-2013 from 791 cases of mergers and acquisitions as the research sample,the focus is the change of the main business and efficiency before and after M&A of enterprises,descriptive statistics analysis,canonical correlation and regression analysis.Finally,based on the theoretical analysis and practical finding,this paper summarizes the impact of internal and external governance environment and political connections on the efficiency of M&A,and proposes some suggestions to improve the efficiency of mergers and acquisitions on this basis.Through the research of the above,this paper draws the three conclusions:First,the state-owned enterprises are still possible by executive staff assigned to the establishment of a political association,for state-owned enterprises,political connection enterprises stronger,will aggravate the state-owned enterprises due to property rights and have a "natural" policy,and damage the burden of mergers and acquisitions efficiency.For the nonstate-owned enterprises,in order to pursue equality and their own survival and development of state-owned enterprises,will also establish various political relations by the executives political association of non state owned enterprises can help the enterprises to get more resources,such as preferential loans,corporate tax rates and the government's preferential policies,so as to improve the efficiency of enterprises M&A.Secondly,the governance environment will affect the efficiency of mergers and acquisitions.For non state-owned enterprises,improvement of external governance environment and internal governance level can really improve the efficiency of mergers and acquisitions,while for state-owned enterprises,the impact is weak.Thirdly,the governance environment plays an important role in regulating the efficiency of political related mergers and acquisitions.The worse the internal and external corporate governance environment,the greater the negative impact of the establishment of political ties on the efficiency of mergers and acquisitions.For non state-owned enterprises,the improvement of governance environment can significantly improve the positive effect of political relevance efficiency.As for the state-owned enterprise group,the moderating role is relatively weak.The main innovation of this paper is as follows:firstly,this paper studies on the research object of the Shanghai and Shenzhen A shares,mergers and acquisitions of listed companies classified into state-owned and non state-owned enterprises,for the contradictory conclusion existing research provides a new breakthrough point,the limitations of the existing research results of non state-owned enterprises more,think there is a natural "political connection of state-owned enterprises,but even with the state-owned enterprises,the political connection intensity is different;secondly this paper will directly influence on internal and external governance environment factors on the different nature of the property enterprise merger efficiency,most of existing literatures on the direct business performance research,while ignoring the role of the key governance factors in the process of mergers and acquisitions,Finally,this article will study,governance environment,political association and enterprise merger and acquisition efficiency linked to one of the highlights of this paper is together.The existing literature studies the efficiency of political association and mergers and acquisitions,but studies regulatory relationship between governance environment and the efficiency of mergers and acquisitions of different property rights.