A Study On The Impact Of Social Connectivity Among Executives On The Performance Of Listed Companies' M&A

M&A,as an important means of outreach expansion,can promote enterprises to expand production scale,realize capital expansion,and strengthen market power.As one of the relationships formed by the informal system,the social connection between executives has the role of information transmission,which can enable master and company to obtain potential information,reduce search costs for target companies,avoid paying excessive payment premiums,and reduce merger and acquisition integration risks.And integration costs to improve M&A performance.At the same time,executives,as agents in the principal-agent relationship,have self-motivated incentives to engage in M&A transactions,thereby harming the interests of shareholders and negatively affecting corporate M&A performance.Therefore,this paper empirically tests the effect of social connections among executives on M&A performance,and further explores the role of information asymmetry and the quality of corporate governance in regulating the relationship between social connections among executives and M&A performance,in order to improve corporate mergers Performance provides empirical evidence and reasonable advice.This article sorts out relevant literature at home and abroad from the three aspects of M&A performance and its influencing factors,the characteristics of executives and senior management teams on corporate M&A performance,and the status of executive social networks and corporate mergers and acquisitions.Based on the theory of information asymmetry,principal-agent The three major theories of theory and synergy theory put forward five research hypotheses.Based on the study of the possible positive and negative effects of social connection between senior executives and short-term M&A performance,the moderating effects of the degree of information asymmetry and the quality of corporate governance on the positive and negative effects of the relationship between them have been examined.This article uses 2003-2018 Shanghai and Shenzhen A-share listed company M&A sample data.First,a full sample detailed descriptive statistical analysis of executive connections,M&A short-term performance,regulatory variables,and various control variables is performed.The short-term M&A performance is divided into For the samples without social connection,academic connection,and post connection,the T-test was performed on the difference between the two groups of samples.Then,the least squares method was used to analyze the impact of executive connection on M&A perforamance and the moderating effect of the degree of information asymmetry and corporate governance quality on the relationship between the two.In Chapter 5,this article uses a factor analysis method to construct a comprehensive score model for M&A performance.The difference between the average performance of the two years after the merger and the two years before the merger is used as a measure of the long-term performance of the merger,and it tests the relationship between social connection among executives and long-term performance of M&A and various financial indicators.The research results show that,firstly,the social connection relationship between the executives of the two sides of the merger and acquisition,especially the existence of the post-connection relationship,will reduce the short-term performance of mergers and acquisitions of the main merged enterprise,the merged enterprise and the post-merger physical enterprise.Secondly,the quality of corporate governance has a positive regulating effect on the negative correlation between the executive's social connection and the short-term M&A performance of the main merged enterprise and the post-merger entity,and the negative correlation with the short-term performance of the merged enterprise;Third,the social connection among executives has a negative impact on the long-term performance of M&A companies and various financial indicators.To ensure the accuracy of the regression results,a robustness test has been added,and the event window period for short-term M&A performance has been r?eplaced.The results obtained are consistent with the results of multiple regressions.This article examines the short-term performance of M&A,M&A,and post-merger entity M&A,the degree of information asymmetry,and the quality of corporate governance from the perspective of social connections among executives.The long-term performance relationship and the regulating role of corporate governance quality are expected to provide reasonable suggestions for improving the performance of corporate mergers and acquisitions.