High Premium M&A And Risk Of Stock Price Collapse Under The Motive Of Large Shareholders' Tunneling

As China's economy gradually turning to medium-high speed development recently,more and more enterprises have been unable to achieve rapid expansion through their own development.At this time,M & A is a way to rapidly improve the competitiveness of enterprises.Reasonable M & A can expand the production scale of enterprises and produce synergy effect.However,with the increasing number of M & As in the domestic market,more and more M & As show the characteristics of high valuation and valueadded rate that it is high premium M & A.The high premium of the target assets doesn't only compensates the control right of the acquiree,but also exists suspicion that uses the high premium M & A to transport the interest.In the future,once there are business consequences such as the withdrawal of huge goodwill impairment and the failure of performance commitment,the profits of enterprises will be greatly impacted,resulting in serious business crisis,affecting the interests of shareholders and the stability of the capital market.High premium M & A has become a major source of business risk at this stage,which has attracted extensive social attention.In the process of the rapid development of China's financial market,although the relevant supervision and management systems are gradually improving,there are still some loopholes need to be filled,among which the tunneling behavior of high premium M & A is a key one.High premium M & A for the purpose of tunneling will not only fail to bring about synergy effect,but may also lead a rapid impairment of high goodwill when the performance is not up to the standard,and cause the share price crash.Therefore,in order to prevent the risks arising from high premium mergers and acquisitions,certain attention must be paid.This paper takes Yinyi Real Estate as the research object,analyzes the causes and effects of Yinyi Real Estate's high premium M & A,clarifies the specific path of large shareholders' tunneling,explores the specific causes of stock price crash,and further summarizes the relevant problems of the crash of stock prices caused by high premium M & A aimed at tunneling.First of all,it introduces the basic situation of Yinyi Real Estate and its major shareholder Yinyi Group Co.,elaborates the specific content of the M & A agreement,and reviews the process of the stock price collapse of Yinyi Real Estate.Secondly,this paper analyzes two high premium M & As of Yinyi Real Estate.First,it uses the event analysis method and induction method,combined with the market reaction after the two M & As.Analysis shows that high premium M & A increases the risk of stock price collapse;second,by using induction and deduction,this paper finds out the motivation of tunneling for large shareholders in high premium M & A from the aspects of the pledge of large shareholders' equity and the increase of control,also it proves the existence of tunneling of large shareholders by the fact.Thirdly,this paper uses induction method to sort out and summarize the transmission mechanism of high premium M & A on the risk of stock price collapse.The results show that high premium M & A has become a new way for large shareholders to tunneling list companies compared with traditional methods;high premium M & A often brings high risk of stock price collapse to listed companies;inadequate information disclosure is the direct cause of stock price collapse.In this regard,we should comprehensively improve the governance from the internal system construction and external supervision.