The Impact Of Corporate Governance On M&A Performance And Mechanism Analysis

Merge and acquisition market in China started later than Western countries,but has been developing rapidly these years.Under the impact of Macro-economic environment,capital market and regulation policy,it went through expansion during 2014-2015 and moved towards rationality since 2016.Gradually,it began to focus more on value investing and industrial significance.Corporate governance impact on corporate performance has already been proved both in theory and practice.However,whether it will influence and how will it influence corporate performance after M&A is the topic going to be discussed in this dissertation.Firstly,from the perspective of core stakeholders governance,combining current literature and the characteristic of M&A,the dissertation chose shareholders,manager and creditor to set up a core stakeholders governance structure under the background of M&A.Later,under the core stakeholders governance structure,the dissertation hypothesized that executive compensation,managerial ownership,long and short-term debt ratio as the representative of internal and external corporate governance mechanism,will influence M&A performance via agency cost and financial distress cost.Then the dissertation used empirical research and found following results:executive compensation increased the agency cost which resulted in a negative correlation with M&A performance;short-term credit ratio reduced the agency cost which resulted in a positive correlation with M&A performance;long-term credit ratio increased the financial distress cost so that it had a negative correlation with M&A performance.Most of the hypothesis had been tested.By comparing different results based on different nature of M&A buyers,the dissertation found that managerial ownership comparatively enhanced the state-owned buyers' M&A performance while credit ratio comparatively dragged down the non state-owned buyers' M&A performance,which indicated that the impact of corporate governance to M&A performance varied according to the nature of property rights.Main contributions of the dissertation are as follows.Firstly,it enriched the study of corporate governance impact on M&A performance.Secondly,it analyzed deeply about the impact mechanism of corporate governance on M&A performance,which provided practical significance for enterprises to design and optimize corporate governance structure creatively.Thirdly,results based on the different nature of property right provided theoretical evidence about macro-policy like reform of mixed ownership in stated-owned enterprises and improving financing environment of private enterprises.