The Study Of The Relationship Between Financing Constraints, Merger Of Payment And M&A Performance

Financing constraints affect the behavior of investment, which plays a crucial role in investment and financing decisions, determining the direction of enterprise investment, scale and benefits, etc. Therefore, The M & A activity as one of enterprise’s investment activities, including the Payment of M & A, inevitably also affected by financing constraints. The literature at home and abroad about M & A is also abound. However, for literature of the impact of financing constraints on M & A payment abroad is got less attention ,lacking of depth and breadth, the domestic related literature is also even fewer. The study of the relationship between Financing constraints, Merger of payment and M & A performance is not only a further extension of the theory of financing constraints, it also can be said complementary of the theory of M & A. Therefore, this paper based on the A-share listed companies in China 2008-2012 empirical data, adopting the method of combining normative research and empirical research, exploring what kind of impact financing constraints of listed companies on the choice of payment method will produce, whether the combined effect of the merger between the two and how they affect the performance of M & A performance.Through empirical testing, this paper draw the following three conclusions at last: (1)Financing constraints companies prefer to use cash acquisition of payment; (2)The M & A performance of a financing company is better than that of a company without financing constraints. (3)Companies faced with the financing constraints using cash payment method can improve the performance of M & A; This is because the financing constraints virtually supervises the behavior of managers. In order to grasp the valuable investment opportunities, companies faced with the financing constraints holding large amounts of cash for preventive motivation, is a rational behavior, improving the investment efficiency; Free cash flow hypothesis is not applied to the company facing financing constraints.In the end, referring to theoretical analysis and empirical results of the article, combined with our special financing environment, put forward relevant policy recommendations. The main recommendations proposed from the micro-level enterprises, capital market level and the government regulation level, hoping to be able to provide practical reference to choose the payment of domestic M & A activity and improve M & A performance.