Research On Hollowing Out Behavior And Governance Of Major Shareholders Of Lianchuang Shares Under Continuous High Premium Mergers And Acquisitions

Along with the in-depth development of market economy and the constant adjustment of economic structure in our country,the need for transformation and upgrading of traditional enterprises is increasingly intense.Injecting vitality into the slow-growing traditional industries through merger and acquisition of new enterprises has become the first choice of many enterprises.However,in the process of transformation of merger and acquisition,there are also more and more irrational behaviors.Among them,vicious events of major shareholders occupying assets of listed companies and hollowing out listed companies by continuous mergers and acquisitions often occur.At present,the shares of listed companies are generally concentrated.Therefore,the major shareholders have the overwhelming power of discourse to participate in the operation and decision-making of the listed company,which also gives the major shareholders the opportunity to seize the assets of the listed company by means of equity pledge,illegal reduction of holdings,etc.This behavior will not only seriously affect the future development of the enterprise,but also seriously undermine the interests of minority shareholders.At the same time,it also brings challenges to the benign development of our capital market.In this paper,Shandong Lianchuang Industrial Development Group Co.Ltd.(hereinafter referred to as "Lianchuang Shares")is taken as an example,and the relevant literature of domestic and foreign scholars on the motivation of successive mergers and acquisitions and the hollowing out behavior of major shareholders is reviewed,and the case of hollowing out of major shareholders of Lianchuang Shares is analyzed in detail by combining the principal-agent theory,information asymmetry theory and the theory of PBC.First of all,the basic situation of the two parties and the continuous process of merger and acquisition are introduced.Secondly,the five-factor model of CRIME is used to analyze the hollowing out behavior of major shareholders of Lianchuang Shares from five aspects: actor,means,motivation,supervision mechanism and behavior result.It is found that the hollowing out behavior of major shareholders is carried out due to the defects of internal governance and insufficient external supervision of Lianchuang Shares.Major shareholders obtain private gains by means of equity pledge,high level reduction and related transactions,which has a negative impact on the whole company,minority shareholders and even the whole capital market.Finally,from the corporate level and the external supervision of two aspects of major shareholder hollowing out related countermeasures.Through research and analysis,this paper draws the following conclusions: First,the continuous high-premium merger and acquisition activities of the enterprise do not mean that the enterprise is merged into high-quality assets,but may also be the disguised activities of illegal arbitrage by the major shareholders of the company by taking advantage of the loopholes of internal and external supervision.After the major shareholders buy assets at a high price,they manipulate the volatility of the stock price,use the reduction of holdings and equity pledge for arbitrage,and finally sell them to the related parties at a low price when the underlying performance explodes.Second,in addition to the incentive of high income and low cost,the hollowing out behavior of major shareholders can not be achieved without the imbalance of corporate ownership structure and the defects of internal and external supervision.Therefore,this article from the corporate governance and external supervision of two aspects of governance countermeasures.First,we should improve the reasonable equity checks and balances mechanism,improve the relevant system of directors and supervisors,improve the performance commitment compensation method,and standardize the approval process of successive mergers and acquisitions.Second,update the regulatory technology,strengthen the supervision of merger and acquisition activities,strengthen the supervision of intermediary institutions,strengthen the role of media supervision,increase penalties,improve the protection system of minority shareholders.This study is of reference significance for the protection of the company development,the interests of minority shareholders and the healthy development of the capital market.