An Empirical Analysis Of M&A Announcement And Stock Price Effect

In recent twenty years,with the development of China’s economy and the gradual reform of financial supervision,M&A activities are booming in China.As a market with many start-ups,gem has become an important part of China’s stock market.Innovative enterprises are backbone of China’s innovation and development.Compared with the main board market,gem enterprises contain many non-traditional industries.This paper intends to study stock price effect of M&A behavior of Listed Companies in China’s growth enterprise market,in order to make a systematic and comprehensive analysis on relationship between M&A behavior and stock price fluctuation of Listed Companies in China’s growth enterprise market,so as to provide reference for investors in China’s stock market.This paper analyzes motivation and influencing factors of M&A behavior of Listed Companies in gem,and expounds the formation mechanism of stock price effect of M&A behavior of innovative enterprises.Using event study method,this paper studies changes of stock prices of listed companies on GEM before and after the first announcement of M&A,and draws the conclusion that stock price effect of M&A is significantly positive.Then we use regression analysis method to analyze influencing factors of stock price effect of M&A behavior of Listed Companies in gem.The results show that there is a significant stock price effect in M&A behavior of GEM listed companies.The stock price effect is most obvious in five days before and after first announcement.The cumulative excess return of stock price effect of M&A behavior of listed companies on GEM in China.The results of this paper can help investors understand reaction of M&A behavior of GEM listed companies to stock price,and provide reference for investors’ investment decision-making.At the same time,this paper reveals formation mechanism of stock price effect of M&A behavior of GEM listed companies in China,and puts forward corresponding policy suggestions to protect interests of investors and make China’s capital market develop better.