Research On The Protection Of Minor Shareholders' Interests Based On The Perspective Of Performance Commitment

Since 2013,more and more mergers and acquisitions have come out each year which has become really hot among the listed companies in the A-share market.At the same time,the commitment of performance,as the measurement of removing the concern from original shareholders and supervisors about the operating condition in the future,has followed by increasing attention.Currently,most listed companies recombine merger and acquisition using the revenue method,and the revenue method will consider the performance commitment of the target organization to a large extent.Most of the enterprises in order to facilitate the merger and acquisition,exaggerate the market prospect,and gives a high performance commitments,to form the high premium acquisition for high performance commitments,once the actual performance can not be achieved,it will has the performance compensation.It is theoretically possible to protect the interest of the small and medium shareholders in a certain extent,but in the actual implementation,it is not known to safeguard the interest of the small and medium shareholders or to prejudice them.This paper will make a research in this area by case analyzing.As the research object in the paper,I choose a typical company Eging Photovoltaic Technology Co.,Ltd..I am going to study whether the commitment of performance can effectively promote the operation of listed companies and ensure the profit of medium and small investors.I hope that I can provide a theoretical and practical learning with system of performance compensation commitment.The idea in the paper has been divided into 3 parts as following: why big shareholders make such a commitment,what will happen when triggering the commitment and whether the commitment can protect the ideas of medium and small shareholders.With the idea talking above,firstly,I analyze the reason why big shareholders of Eging Photovoltaic Technology Co.,Ltd.make such a huge amount of commitment.Followed by this,I will study the behavior of big shareholders of Eging Photovoltaic Technology Co.,Ltd.when committing the performance during 2011 and 2014.Finally,with a research of the operational effect during the time of performance commitment of Eging Photovoltaic Technology Co.,Ltd.and the marketing reactions of medium and small shareholders,I will give some suggestions according to the beginning,middle and the end of the period of performance compensation commitment.According to the research in the paper,I find three problems as following.Firstly,in order to back door listing,big shareholders of Eging Photovoltaic Technology Co.,Ltd.used the asymmetry of information to make a compensation which was inconsistent with the corporate environment.Secondly,when the performance could not reach the standard which will trigger the compensation,big shareholders of Eging Photovoltaic Technology Co.,Ltd.may modify the commitment and promote the modification accepted by most of the shareholders to affect the operation of the company and injure to the interests of shareholders.Thirdly,the performance compensation commitment does not make a progress to the operational performance of listed companies.Also,the medium and small shareholders leave a negative reaction to the commitment made by big shareholders.All in all,the performance compensation commitment does not play a role of protecting the profit of listed companies and medium and small shareholders.