Can The Performance Comitment Pay The Bills For The High Purchase Premium Of The Listed Company ?

In 2013,Chinese' capital market has appeared a new type of mergers and acquisitions—mergers and acquisitions with performance commitment.And this type of M&A almost become the basic configuration of listed companies' M&A in China.However,with the arrival of the performance commitment period,the phenomenon of the commitment party's performance didn't achieved the commitment,the assets of the mergers and acquisitions been damaged,and the two sides of M&A even recoursed to the law due to the carry out of the compensation commitments can not reach an agreement can been seen everywhere.Therefore,it is very important to rethink the impact of M&A with a performance commitment on the performance of listed companies,and to analyze the conomic consequences of the M&A with a performance commitment based on the rationality of the blind performance of listed companies.Therefore,this article use the typical merge case in Chinese A-share marke-Shenzhen Success Electronics Co.,Ltd merged Shenzhen Accor vision Polytron Technologies,which the commitment party didn't meet the commitment performance after M&A,as an example.Based on a detailed exposition and analysis of blindly mergers and acquisitions with a performance commitment in Chinese listed companies,this paper has conclued that blindly M&A with a performance commitment may not be able to achieve the listed companies' original goal,but also lower the listed company's financial performance and market performance,damage to the value of enterprise shareholder.While carry out the further analysis on the causes that led to these consequences,this article found that such as intensified industry competition,not high inherent growth of the merged enterprise is the main causes that lead to these consequences.Finally,this paper also put forward some suggestions to Chinese listed companies' Mergers and acquisitions practice that with a performance commitment:(1)On the strategic layout,the Merger should pay attention to the debelopment fo industry and the acquirer's own inherent growth when considering the probability of the acquirer to realize performance commitment;(2)On the acquisition plan,the third party organization should reasonably determine the valuation based on the predicting of the future development of enterprises,and the mergers should pay attention to the diluted control of the company when chose the payment method;(3)On the aspect of supervision,the capital market regulators should further refinement of the terms of the merger,which been added a performance commitment,and promote the full implementation of the compensation agreement.