Empirical Study On Effects Of M&A In China's Stock Market In 2003

M&A brings the fluctuation of the stock price of the target companies. At the same time the value of the target companies fluctuates. The Case Study Method and Abnormal Returns Methodology are used in the paper. After the empirical study on the population of 148 M&A cases in china's stock market in 2003, the author reaches the conclusion that: 1)M&A brings the increasing of the target company's value in a short period. However the target company's value could be decreased by M&A in a relatively long period. 2) the M&A information has been divulged before it is disclosed officially. 3) the type of M&A, the type of acquiring firm and the type of transfer have an impact on the value of target companies. The industry of target firm and the proportion of acquiring firm's stock share have little impact on the value of target companies.