The Impact Of Performance Commitment In M A On The Interests Of Minority Shareholders

M&A reorganization is the development mode of rapid expansion of many enterprises,especially since 2014,the domestic M&A market has developed rapidly,the M&A rate has accelerated,and the scale of M&A has increased.In the process of M&A,due to the asymmetry of information,coupled with the fact that M&A transactions in the domestic market are increasing in price,the capital is weak and the information is less.The minority shareholders with low discourse rights are the weak groups in the M&A of listed companies,and their rights are not guaranteed.As a contractual system,performance promises reduce information asymmetry between M&A parties and ensure fair transaction rights and interests of both parties,especially the interests of minority shareholders of M&A parties.Performance promises played an important role.However,with the rapid development of the domestic M&A market,many companies are approaching or have reached the performance realization period,many companies cannot fulfill their performance commitments,and even some companies are far from fulfilling their performance commitments,which greatly damages the interests of minority shareholders.Therefore,it is very important to study the effect of performance commitment on the interests of minority shareholders in M&A reorganization.Taking Xinhua Medical merger and acquisition of Chengdu Yingde as an example,this paper analyzes the acquisition process and the achievement of Chengdu Yingde from 2014 to 2017,and studies the impact of performance commitment on M&A premium and business benefits.The market reaction problem caused by the event,the impact of performance commitment on the protection of minority shareholders' interests is evaluated,and the corresponding improvement suggestions are put forward.The research finds that,firstly,performance commitment stimulates the increase of M&A premium,and the goodwill impairment and earnings management problems formed by M&A premium form a hidden danger,which increases the risk borne by minority shareholders in M&A;Secondly,the original intention of performance commitment was to protect investors' interests,but performance commitments cause losses to investors,especially for minority shareholders in a disadvantaged position when the performance commitments are not completed;Finally,the high performance promise can send a good signal to the market,thus forming the announcement effect,increasing the excess return of the minority shareholders,but when the stock price cannot be realized,the stock price will be frustrated or even plummeted,which seriously affects the interests of the minority shareholders.The positive effect of performance commitment compensation on the interests of minority shareholders is limited.At the same time,this paper puts forward the problem of infringing the interests of minority shareholders caused by the above performance commitments.The corresponding countermeasures and suggestions are put forward.