Institutional Investors Holding The Mergers And Acquisitions

Under the strategic guidance of "super normally developing institutional investors", China's institutional investors have enjoyed great development recent years.They are becoming positive to participate in governance of listed companies.From the perspective of M & A, this paper researches the impact of institutional investors in the process of governance of listed companies and its effects.This paper firstly reviewed the literatures on the relationship between institutional investors and corporate governance.On this basis, China's M&A activity was analyzed.Then we proposed four hypotheses about the relationship between institutional investors and M&A of listed companies.After that, from the two financial databases of WIND and CSMAR we choose 339 samples of M&A events occurred in 2004 and 2006 and relevant data. This paper putted forward several empirical models.Next, in order to test the above hypothesis, Logistic Regression and Least-squares linear regression was used, finally reached the following conclusions:(1)China's institutional investors as a whole had no substantial impact on the decision-making of M&A with related party.No significant correlation showed between institutional investors ownership and the probability of M&A with related party;(2) Different types of institutional investors played different roles in the process of M&A.Only Security Companies and QFII shareholding ratio showed significant negative correlation with the probability of M&A with related party;(3) The higher of institutional investors holding, the better performance of M&A;(4) Different types of institutional investors post different impact of M&A performance.Only Securities Investment Funds'shareholding ratio was significantly and positively correlate with the performance M&A.Conclusions of this study can make use on the developing of China's institutional investors as well as leading them to participate in governance of listed companies.