Merger And Reorganization Under The Control Of Major Shareholder:Tunnelling Or Propping

Due to the particularity of the domestic capital market,the principal-agent problem in the domestic capital market is not the same as that in the western capital market.The phenomenon of "one share dominates the other" widely exists in the domestic listed companies,so the domestic capital market presents a more prominent situation of the second type of agency problem,which is the conflict of interest between large shareholders and small and medium shareholders.Researchers at home and abroad have a relatively large number of literature on tunneling of listed companies by major shareholders,including tunneling means,impact,etc.,and a relatively small number of literature on the propping behavior of major shareholders,but in fact,the tunneling and propping behavior of major shareholders for listed companies do exist simultaneously.In recent years,with the occurrence of M & A events in the capital market more and more,a new round of M & A tide is also coming.Domestic researchers are more and more concerned about M & A events in the capital market.Many researchers found that in the process of M & A,it may also have a hollowing out effect and propping effect on the company.This paper mainly studies the "tunneling" and "propping" behaviors in the merger and acquisition under the control of major shareholders.Based on the principal-agent theory and the theory of private earnings of control rights,the paper selects elion Jieneng as a case company,and analyzes the behavioral motivation,implementation methods of "tunneling" and "propping" of elion Jieneng's major shareholder elion group during 2010-2016 in theory and practice Impact: the analysis results show that the merger and acquisition activities carried out when the company has the motivation to avoid losses and protect the shell can significantly improve the company's performance in a short period of time,but without the shell.The purpose of the merger and acquisition activities carried out when the worry of improving performance is to empty assets,which will damage the company's value and affect the company's overall performance.According to the research findings of this paper,the author puts forward several suggestions,including optimizing the ownership structure of listed companies,establishing a restraint and incentive mechanism,strengthening the professional ethics of intermediary service agencies,and strengthening supervision.