Ownership Structure,Control Contestability,and Debt Maturity Structure:Empirical Evidence From Chinese Private Listed Firms

The issues of corporate governance have been well received by scholars' attention.Some studies have shown that self-centered large shareholders tend to sacrifice the interests of minority shareholders to satisfy their own interests.Large shareholders own a large number of stakes who can often make a greater impact on the company's decision-making and operations,thereby conducting "tunneling"behaviors which is obviously not conducive to long-term development of the company.These behaviors make large shareholders prefer long-term debt rather than short-term debt in order to avoid external stakeholders'supervision.In recent years,with the rapid development of Chinese private listed firms,they have become the catalysts for China's economic development which are necessary to be studied.In this context,this article focuses on the impact of multiple large shareholders' interaction on the company's debt maturity structure.Debt maturity structure is defined as the ratio of long-term debt and total debt.To some extent,debt maturity structure can reflecte the effectiveness of internal supervision.Some scholars believe that the relationship between multiple large shareholders is checks and balances,they will lead each other to be more inclined to short-term debt and reduce the amount of free cash flow.Howerver,some studies show that this kind of relationship will make the value of the company reduced.One plausible explanation is that the relationship between multiple large shareholders is conllusion,they use greater long-term debt in order to avoid external supervision thus violating the interests of other stakeholders.In addition,previous studies have generally follow the principle of one share,one vote.However,the stakes of shareholders and control rights are different,it is more suitable for us to use the Shapley-Shubik index based on ocean game to measures the multiple large shareholders' actual control right.Based on the above analysis,this paper uses data from 2008 to 2014 of Chinese Private Listed firms,we first use descriptive statistic and correlation analysis,then examine the effect of ownership structure and contestability by regression analysis under the governmence mechanism of multiple shareholders.From the empirical results,the following conclusions are found in this paper:the number and the control size of multiple large shareholders—beyond the largest shareholder,are associated with significantly higher debt maturity structure,indicating that the existence of multiple large shareholders is not sufficient conditions for checks and balances relation.Large shareholders are not limited to use long-term debt in order to avoid external supervision through "tunneling".This article will be more inclined to the conclusion that the relationship between multiple large shareholders is collusion which violates the interests of other stakeholders,thereby increasing the ratio of long-term debt,their interaction with each other will strengthen their control rights on the company.