| Since 2013,mergers and acquisitions have shown unprecedented activity.However,behind the activity is accompanied by great risks.Some mergers and acquisitions can not only increase the value of listed companies,but also undermine the rights and interests of minority shareholders.Under this background,Performance commitments,as a preventive measure to eliminate such phenomena,have been adopted in mergers and acquisitions.The original intention of signing the performance compensation commitment in mergers and acquisitions is to restrain the counterparty,guarantee the quality of the acquisition target and the ability of sustainable development.There are different opinions on the causes of high performance commitment,high valuation and high premium.One point of view is that PE/VC takes M & A as an exit channel,and will consider using performance commitment to increase the premium rate,so there is a motivation to support the valuation with high performance commitment.But in fact,the market role of PE/VC in M & A is relatively objective.With the introduction of the registration system of equity investment funds,PE/VC began to grow and develop under the unified supervision.The early phenomenon of blind profit seeking of equity and entrepreneurial private funds does exist.With the government's positive support and guidance,and the gradual improvement of the maturity of the industry,gaining a healthy income and digging deep into the industry has gradually become the consensus of equity investment fund circles.How to realize the reorganization of industrial resources through mergers and acquisitions,and at the same time play a synergistic effect,and thus bring about the growth of enterprises is the focus of attention.In recent years,some scholars' research also shows that equity investment funds play a positive role in mergers and acquisitions.How does PE/VC play a role in performance compensation commitment? In order to explore this problem,this paper is based on the study of equity investment funds and performance commitments by the existing scholars,focusing on the role of equity investment fund(PE/VC)in merger and acquisition performance compensation commitments.Thus we can find the role of equity investment fund(PE/VC)in the performance compensation undertaking of M & A and its impact on M & A performance.This study takes small and medium sized companies and GEM companies as samples from 2011 to 2016.Two major problems are studied in detail.First,whether equity investment funds(PE/VC)participate in mergers and acquisitions will affect the performance commitments signed in mergers and acquisitions.Specifically,it is reflected in the size of commitments and the success or failure of commitments.Second,on the basis of the previous research,we further discuss the impact of equity investment fund(PE/VC)on the performance of mergers and acquisitions of listed companies.As a test of the effect of M & A transaction.The study found that the existence of PE/VC in the performance commitment of M & A will inhibit the signing amount of performance commitment.Although mergers and acquisitions have become the second major channels for PE/VC to withdraw.PE/VC is inclined to sign a relatively low performance commitment when it holds the target of merger and acquisition.In addition,we find that there is a smaller possibility of performance failure in PE/VC holding targets.When the performance commitment is relatively high,the possibility of successful completion of performance commitments by PE/VC holding targets is greater.Finally,we examine the M & A performance of listed companies.We find that when reviewing long-term performance,when performance commitments are successfully fulfilled,the M & A target with PE/VC shareholding can bring higher stock holding rate of annualized returns to listed companies compared with no PE/VC shareholding M & A target.For short term performance,when the performance commitment is high,and PE/VC holds the shares of the acquired company,the stock returns of the listed companies are higher and the market reaction is better.Finally,we examine the market performance and financial performance of each year during the performance commitment period.When the performance commitment is successful,PE/VC holds the shares of the acquirer,which can bring higher stock returns to the listed companies every year.For each year's financial performance.For highly valued underlying assets,financial performance is only promoted when PEVC holds underlying asset stocks.When PE/VC does not have M & A targets,it requires high performance commitment to improve financial performance.This study helps identify the role of equity investment funds in mergers and acquisitions.It has certain practical significance to guide equity investment fund to participate in M & A activities correctly. |
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