Research On The Interest Transfer Of Private Placement And Acquisitions And Performance Compensation Commitment

With the development of the private placement market,private placement has become the main force of the refinancing market in China.Among different purpose,M & A has become an important purpose of private placement.However,due to the specific attributes of private placement for the purpose of & A,there is large space for interest transfer.Based on this issue,in 2008,the regulator promulgated the corresponding policy,performance compensation commitment,to restrain the interests transfer problem during private placement and M & A.Nearly a decade later,the validity still remains to be verified.In the aspect of theoretical research,this article elaborated the existing research on the problem of interest transfer in private placement and M & A market in academia.Also,this article concluded the way of measuring the degree of interest transfer which is universally accepted by academia.At the same time,it analyzed the theory of performance commitment system to influence interest transfer.What is more,it constructed a model based on the game theory to demonstrate the incentive effect of performance compensation commitment.In the empirical aspect,based on the 290 cases of private placement and acquisitions from 2008 to 2015,this article used a rigorous empirical method,which combines descriptive statistics analysis and regression analysis.Such research made up the past blank area in academia,since past research generally was based on case and theory analysis and lacked empirical research.It also combined the method of propensity score matching and difference in difference,which supports the robustness of the core conclusions in the paper.The main conclusions of this paper included: firstly,the participation of major shareholders aggravates the problem of the transfer of interests during private placement and M&A.Under the signal effect,performance compensation commitment fails to solve short run tunneling,but such commitment helps improve long run interest transfer through the long-term incentive effect,especially the stock compensation when big shareholder participates.This result can provide policy advice to improve performance compensation commitment and further extend the usage of stock compensation under big shareholder participation.