The Impact On M&A Performance Of Heterogeneous Institutional Investors

Under the influence of the global fierce cross-border competition environment,a new round of mergers and acquisitions has begun.Meantime,the process of de-diversification of the market has also continued to advance.Institutional investors,as important participants in the capital market,have grown rapidly.In this context,more and more scholars focused on related research on merger performance and institutional investor decision-making.In order to explore the impact of institutional investors' decision-making on M&A performance and its internal mechanism,the article selects 256 listed companies that successfully M&A in 2016.Use event research and financial factor analysis to study short-term M&A performance and long-term M&A performance.The article aims to examine the decision-making role of different types of institutional investors from the perspective of corporate governance.Also,the article explores whether institutional investors can adjust the effect of influence through corporate equity governance and internal compensation governance to improve the performance of M&A.This study finds that M&A can significantly improve the short-term performance and long-term performance of enterprises.Different types of institutional investors have entirely different sides to corporate M&A performance.Among them,the pressure-suppressed institutional investors are significantly negatively related to the short-term performance of mergers and acquisitions,and significantly having positive influence on the long-term performance.Pressure-sensitive institutional investors are significantly positively related to the short-term performance of mergers and acquisitions in order to meet their own needs exist in the management to form a community of interests,which occurs at the expense of long-term development of the company in exchange for short-term speculation.Meantime,the shareholding of the largest shareholder is significantly negatively related to the long-term performance of mergers and acquisitions.It has a significant suppressive effect on the negative relationship between pressure-suppressed institutional investors and the short-term performance of mergers and acquisitions.And executive compensation has no significant relationship with long-term and short-term performance and there is no significant regulatory effect on institutional investors.It shows that the construction of management compensation system of Chinese listed companies is still not closely integrated with market decisions.In the future,this study suggests that the regulatory authorities should strengthen supervision and the independence of institutional investors.The regulatory should actively encourage and guide various institutional investors to participate in corporate governance construction,raise the upper limit and expand the scope,breaking through the constraints and bottlenecks of institutional investor development.It is also necessary to supervise and prevent it from colluding with the top executives of major shareholders,thereby causing problems in disrupting the order of the capital market.At the same time,this study proposes to actively promote the construction of an internal salary management system that combines the assessment of executive compensation in Chinese listed companies with the benefits of major decision-making events,and strengthen the training of managers in their professional direction.