The Relationship Between Enterprise Conglomerate Mergers And Financing Constraints

In the wave of mergers and acquisitions in recent years,the proportion of conglomerate mergers and acquisitions has gradually increased.However,a large number of previous researchers have confirmed that due to agency problems and managers' overconfidence,conglomerate mergers and acquisitions are usually accompanied by a decline in operating performance,thus resulting in a phenomenon that theoretical research runs counter to social trends.This article is inspired by this phenomenon and tries to verify whether conglomerate mergers and acquisitions can have a positive impact on the main and partner companies.However,issues related to financing constraints have always been the focus of financial management research.In the past,there have been studies on merger and acquisition events that can ease the financing constraints of the main merger and acquisition parties,but there has been no study on conglomerate merger and acquisition events according to different merger and acquisition purposes.In addition,there are many researches on financing constraints at home and abroad.However,at present,there are few researches that use cash-cash flow sensitivity model as the verification basis,and more researches are carried out by using a more common investment-cash flow sensitivity model,mainly because the applicability of the former to China's special capital market is still in the verification stage.Therefore,this paper attempts to study the relationship between conglomerate mergers and acquisitions and financing constraints,in order to test whether conglomerate mergers and acquisitions can have positive effects and effects on the main and parallel companies compared with other types of mergers and acquisitions,and then provide corresponding theoretical research for corporate mergers and acquisitions and financing constraints.In the process of verification,it is also necessary to introduce virtual variables of merger and acquisition events to verify the impact of strategic merger and acquisition events including conglomerate merger and acquisition on the financing constraints of the main merging parties.Then,it is divided into conglomerate merger and acquisition groups and inter-bank merger and acquisition groups according to the merger and acquisition purposes of the main merging parties to test whether conglomerate merger and acquisition has more significant effect on easing the financing constraints of the main merging parties,and the main merging parties of the two types of merger and acquisition groups are classified according to different degree of financing constraints,so as to test the difference of mitigation effects of different financing constraint companies under different types of merger and acquisition events.In this paper,we use cash-cash:flow sensitivity model to measure financing constraints and classify merger and acquisition events according to the purpose of merger and acquisition given in Wind database,taking the listed companies of main and parallel parties of strategic merger and acquisition events in Shanghai and Shenzhen A shares during 2013-2017 as research samples.The research shows that the main merger companies in the merger events generally have financing constraints,but after the merger events,their financing constraints have been eased,and conglomerate mergers and acquisitions can improve their financing constraints to a greater extent,which can explain that conglomerate mergers and acquisitions can form a more effective internal capital market than peer mergers and acquisitions.The standpoint of this article is relatively novel and has certain innovation.The former investment-cash flow sensitivity model is mainly used to measure financing constraints according to the cash-cash flow sensitivity model,and two control variables,financial leverage and debt structure,are added to the basic model.In addition,the difference in the degree of mitigation of financing constraints of listed companies in the main and parallel sides is studied by using the method of comparative analysis,which provides guidance for mergers and acquisitions decisions of Chinese enterprises.