Govemment Guidance And Perfomiance Of Coiporate Overseas Merger And Acquisition

The global economy has gradually cooled down and stabilized,the speed of economic development has gradually slowed down,and foreign trade demand has gradually decreased.China's economic and industrial structure has entered an adjustment stage,and mergers and acquisitions have become the main way for many enterprises to adjust their industries.Since the 21st century,China has proposed "going out" strategies and "One Belt,One Road"initiative,actively expanding foreign cooperation,and leveraging high-quality and high-tech foreign platforms to promote the production of overseas operations and M&A by Chinese enterprises.While ensuring the smooth operation of the market,the Chinese government will also guide the development direction of Chinese enterprises through relevant policy systems.Therefore,enterprises will be more or less affected by the government in the process of overseas mergers and acquisitions.On the one hand,companies can obtain various M&A policies including financial support,tax incentives,and risk protection through the government to reduce their financing costs and overseas M&A risks.On the other hand,the government's guidance in the M&A may be to many political motives,like promoting the local economic development,maintaining social stability and employment,rather than the development of the company's own interests.In addition,companies with political relevance are prone to "rent-seeking" problems,which affects the optimal allocation of resources and increases the cost of M&A.Therefore,researching the relationship between government guidance and overseas M&A performance and whether companies with political relevance will affect the impact of external environment in the region on enterprises,which is important to improve China's existing overseas M&A policy system,and accelerate the government to help the transformation for Chinese enterprises.According to a review of the literature,it can be found that most of China's research on overseas M&A performance is short-term M&A performance,but the long-term development of an enterprise can determine whether the company has obtained corporate benefits due to M&A.Based on the theory of M&A performance,using the event research methods assess short-term M&A performance,and the factor analysis assesses long-term performance.Then,based on the theory of government guidance,the logistic regression method is used to conduct an empirical analysis of the short-term and long-term performance of government guidance and corporate overseas M&A,and the cross-variables of political relevance and government guidance are introduced to obtain one:how the government guidance affects the M&A performance;Second:whether the political relevance will affect this effect of government guidance and how it will affect it.The study found that government guidance has a negative correlation with short-term M&A performance,but has a positive correlation with long-term M&A performance.This shows that government policy guidance has a positive effect for overseas M&A,the government can help it avoid many political risks and provide support for overseas M&A policies,which also shows that in the context of the "Belt and Road" initiative,under my country's market economy system,the government can use policies to guide the general direction of overseas mergers and acquisitions to avoid M&A losses due to information asymmetry and political risks;In addition,only the impact of government guidance on short-term performance is affected by the degree of political relevance.That means with a certain degree of government guidance,the higher degree of political relevance,the better performance of overseas mergers and acquisitions;this may be the more politically connected a company,enterprises with political connections can use their relationships to prepare for mergers and acquisitions in advance,making their mergers and acquisitions more in line with state-led overseas mergers and acquisitions,so as to obtain the funds needed for mergers and acquisitions in the short term,Finally,this article summarizes the results of the empirical analysis,and from the three aspects of business,government,and policy measures,it puts forward specific recommendations for related issues between Chinese companies conducting overseas M&A and the government.At the same time,some improvement measures are put forward for the deficiencies in the research of this article,and improved ideas and methods are proposed for the research of related M&A papers in the future.