An Empirical Study About MBO Of Chinese Listed Companies

Management buyouts can be widely implemented to enhance the performance of listed companies in the effective capital market. It shows that the form of property rights reform has its unique rationality and superiority. Our country is in the phase of weakly effective capital market now, there are enormous differences in the policy environment supporting MBO and specific practices comparing to the operation of effective capital markets. So far, there is no uniform conclusion in the feasibility studies that Chinese listed companies perfect the corporate governance structure, establish and improve the incentive mechanism and raise the level of performance through the form of MBO. So to reasonably promote the property rights reform process of Chinese listed companies, testing the effect of MBO and puting forward policy recommendations from the point of performance analysis is of great significance.Combining with theoretical research results and comparison of foreign models, the paper conducted empirical studies of Chinese listed companies, mainly analyzed the development Status and net performance of MBO. The part took 858 listed companies in the Shanghai and Shenzhen A-share market which had kept continuing operations during the period 2001 -2007 as the samples. Dividing them into the role of group and control group, empirical studies analyzed the net performance of MBO in aspects of corporate value, profitability, operational capacity, growth capacity and solvency. The paper took the software of Eviews 5.0 for data analysis, mainly used the 2 * 2 grid and first-order difference fixed effects model to test the significance of the DID estimator.The conclusions of empirical studies are as follows: There are serious problems of identify of the main, financing, pricing and regulatory in MBO of Chinese listed companies; Following the assumption of the same trend, there was a significant negative correlation between the MBO and operating performance of Chinese listed companies. What is more, there was no significant correlation between the MBO and the performance of other aspects. Combining with the conclusions of empirical studies, the last part of the paper put forward related policy recommendations such as perfect capital market, improve the pricing mechanism, strengthen government regulation and construct the new governance structure.