Research On The Impact Of Performance Commitment Method On Enterprise M&A

With the development of economic globalization and the overall progress of the times,M&A transactions have occupied an indispensable position in the process of the times.In order to avoid the risk of mergers and acquisitions,the performance commitment has gradually occupied the domestic capital market and is sought after by many enterprises.Performance commitments play an important role in mergers and acquisitions.However,in the case of mergers and acquisitions in recent years,there are cases where both parties to the M&A transaction arbitrarily change their performance commitments.This obviously violates the original intention of performance commitment and is not conducive to supervision by the regulatory authorities.On June 7,2016,the regulatory authorities issued a new regulation for M&A transactions-"Related Issues and Answers on Performance Compensation Commitment of Listed Companies." The document stipulates that both parties to the merger should strictly abide by the performance commitments and must not make any changes to the performance commitments.Since different performance commitment methods will have different impacts on M&A transactions,it will become more important for both parties to M&A transactions to choose performance commitment methods as new regulations are introduced.Therefore,this paper combines the research results of performance commitments of other scholars to analyze the impact of different performance commitment methods on corporate mergers and acquisitions,which has practical guiding significance for the M&A market.Based on principal-agent theory,information asymmetry theory,information transfer theory and goal setting theory,this paper summarizes the domestic and foreign literatures related to performance commitment.And from the motivation generated by the performance commitment,the theoretical analysis of the impact of performance commitment on M&A transactions.In combination with the status quo of performance commitment and the status quo of the media industry,we chose the case of Zhongwen media M&A Zhimingxingtong-the choice of share compensation method and two-way performance commitment as the performance commitment method and the case of Borui media M&A Manyougu-the choice of cash compensation method and one-way Performance commitment is the way performance is promised.And draw the following conclusions:First,compared with the cash compensation method,the share compensation method can bring incentive effect to the M&A target companies,and thus enhance the synergy level of M&A.Second,compared with the one-way performance commitment,the two-way performance commitment itself is more able to motivate the original shareholders of the company to complete the promised performance,which in turn will strengthen the synergy of the acquirer.Third,the share compensation method is more suitable for the performance promise of M&A transactions with "high M&A premium and high performance commitment";the cash compensation method is more suitable for performance commitments of non-"double high" M&A transactions.Fourth,no matter what kind of performance commitment method can't guarantee the long-term performance of M&A transactions continues to rise.Based on the above conclusions,relevant research implications are proposed.