The Research On Stock Exchange M&A Performance In Listed Companies

Stock exchange M&A is the purchase by an acquiring company of shares in a targetcompany, for which all of the consideration paid for the shares of the target company areshares of the acquiring company. Compared with cash M&A，Stock exchange M&A cannot only allow companies away Huge financial pressure, but also can avoid tax andachieve a win-win effect in both sides of the M&A. So Stock exchange M&A has beenwidely used in the integration of the international capital markets. But in China, stockexchange M&A start late and has only a short history. So far, this kind of M&A hasn’toccupied an important position in the merger market and has many imperfections.Consequently, to study more of Stock exchange M&A in China has great significance. Itcan enrich and improve the value theory of the M&A performance. And in addition, it ismeaningful in saving transition cost and reducing transaction difficulty with guiding listedcompanies to adopt more rational approach in further M&A.The paper firstly elaborate the content of M&A and the related theories of M&A,while focusing on the motivation theory of the M&A Performance combined with ouractual situation in China. They are the theoretical basis for the support and research. Next,this paper selected23lord companies from stock exchange M&A cases occurred from2001to2011as the research sample. We analyze the effects of stock exchange M&Aempirically by Event Study Methodology in short and long horizon and by FinancialIndicators Methodology in long horizon. The results show that: in the short term, EventStudy Methodology results show that the M&A improve corporate’ performance; in thelong run, the results of Financial Indicators Methodology show that the company’slong-term performance has not been improved. Finally, we analysis the results from multipleperspectives and put forward some reasonable proposals.