Research On The Factors Affecting The Choice Of M&A Financing Methods In Pharmaceutical Listed Enterprises

M&A activities of enterprises require a large amount of financial support,and enterprises often meet the needs of mergers and acquisitions through different financing methods.When choosing the M&A financing method,it usually takes into account the limitations of external factors such as law and market,as well as the financial characteristics such as corporate capital structure,growth,profitability,and the influence of equity structure factors.The most direct internal factor of the enterprise is the capital structure.Many companies take advantage of merger financing to adjust the capital structure to achieve optimal capital structure and maximize corporate value.Whether the enterprise's adjustment of the capital structure's demand can be met is limited by the financing cost.The investor determines the financing cost according to the financial information disclosed by the enterprise to judge the investment risk and the expected return.However,some enterprises have the suspicion of whitewashing financial statements,exaggerating expected returns,and underestimating losses to mislead investors.Therefore,the soundness of accounting information disclosed by enterprises has also attracted investors' attention.Robust financial information can reduce the risk of information asymmetry,reduce the agency costs and financing constraints generated by contracts,reduce the friction of corporate financing channels,and meet financing needs.Relevant research at home and abroad shows that the more stable the financial statements,the more able to gain the trust of shareholders and creditors,and the willingness of investors to invest and creditors to lend,the financing cost of enterprises will also decrease;on the contrary,people have low accounting stability.Enterprises cannot effectively judge the actual operation status,investment direction and value of the enterprise,and it is difficult to make investment decisions,which makes it more difficult and costly for enterprises to conduct financing.On the basis of trade-off theory,agency cost theory,superior-order financing theory and financing constraint theory,this paper reviews the research status at home and abroad,proposes the hypothesis through the above analysis,and uses the Logit regression model to verify the impact of capital structure,accounting robustness and the cross terms of the two on M&A financing decisions.This paper selects the M&A events of the pharmaceutical industry during 2010-2018 as a sample of research.Through empirical analysis,the following conclusions can be drawn: First,compared with companies with insufficient leverage,over-leveraging companies are more inclined to choose equity financing methods;Considering the distance between the actual capital structure and the target capital structure,the financing method is adjusted,that is,there is a capital structure adjustment behavior.Therefore,the greater the difference between the actual capital of the enterprise and the target capital structure,the more serious the situation of excessive leverage,and the more inclined the ente rprise chooses the equity financing method to adjust the capital structure of the enterprise to the optimal value.Secondly,under the premise of controlling other factors,listed companies with high accounting stability tend to choose equity financing methods.Investors can predict future bankruptcy risks and litigation risks through sound accounting policies.Therefore,accounting conservatism can help alleviate the degree of information asymmetry between investors and listed companies.According to previous studies,accounting conservatism can be used to limit equity financing.The reduction is higher than the reduction of debt financing constraints,and enterprises with high accounting stability can obtain equity capital at a lower cost.Therefore,companies with higher accounting stability tend to choose equity financing methods.Finally,among the over-leveraged enterprises,enterprises with higher accounting stability tend to choose equity financing methods compared with enterprises with low accounting stability,which proves that the capital structure adjustment behavior of enterprises is affected by accounting conservatism.In short,the target capital Structural deviations and accounting conservatism and their cross-cutting items have a significant impact on the choice of M&A financing methods.The conclusions of the study prove the hypothesis of this paper.In order to strengthen the verification of the conclusions of this paper,the industry's asset-liability ratio median is used instead of the target capital structure to construct a leverage deficit,and the book-to-market ratio is used instead of the negative cumulative accrual as an alternative to accounting conservatism.The variables are tested for robustness of the model,and the test results are consistent with the original test results,supporting the hypothesis of this paper.Based on the conclusions of empirical research,this paper proposes policy recommendations for regulators,acquirers and investors.The relevant research results in this paper provide relatively clear empirical evidence for the relationship between financing methods,accounting conservatism and capital cost.The relevant empirical analysis results have important practical significance for the selection and application of corporate accounting policies and the decision-making of financing methods.