Cross-ownership M&A And Financing Constraints Of Private Enterprises

Capital financing is important to the growth and development of companies.Financing constraints may pose dilemmas that lacking of financing channels and higher opportunity cost for companies,thereby affecting their research and development and investment expansion decision.The existing research has noticed that there are significant differences in the level of financing constraints between private enterprises and state-owned enterprises,and indicates that the financing constraints of private enterprises are one of the shackles that restrict the development of China's private economy.In order to give full play to the unique advantages of the two kinds of economic and eliminate the development shackles caused by institutional reasons,important measures to promote the mixed ownership have been advanced by the state since the fifteenth national congress of the CPC.On the strategic guideline of economic development,we should accelerate the process of the development of mixed ownership and continue to evolve in depth,so that we can complement the advantages of different economies and activate the vitality of the two.Therefore,this article explores the effect caused by cross-ownership merger and acquisition to financing constraints of private enterprises,which is one of economic consequences of participating in mixed-ownership reform.And on this basis,the article explores the path of this effect.In order to achieve the purpose of the study,we combine theoretical analysis and empirical research,using M&A data of A-share listed private companies among 2007-2015,to analyze the effect of cross-ownership merger on financing constraints of private enterprises.Then,through testing the impact of cross-border M&A on the internal control quality and external political association level of private enterprises,followed by testing the changes in the degree of financing constraints improved by adding the two factors respectively,to verify whether they are intermediary variables for this effect,so as to clarify the function pathway.Through theoretical analysis and empirical test,it is found that the financing constraints faced by the private listed companies can be alleviated after cross-ownership merger and acquisition.At the same time,the internal control quality in the year after cross-ownership of M&A is improved compared with the very year,and the mediating effect test proved that the quality of internal control is one of the intermediary variables between cross-ownership M&A and financing constraints.The political association level in the year after cross-ownership of M&A is improved compared with the very year,and the mediating effect test proved that the political association level is another one of the intermediary variables.And it is proved that both are partial mediating variables.In conclusion,on the one hand,it proves that private enterprises can alleviate the financing constraints faced by the mixed ownership merger and acquisition,which is the positive significance of the mixed-ownership reform to the private enterprises.On the other hand,it also explores the theoretical path and basis for the emergence of this economic consequence,so as to provide a reference and theoretical support for the promotion of mixed-ownership reform.