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M & A performance of listed state-owned companies and non-state-owned listed companies Empirical Comparison

Author: ShuBo From: www.yourpaper.net Posted: 2009-10-06 20:24:58 Read:
[Abstract] In this paper, the event study method, empirical study of the 2007 Shanghai and Shenzhen 194 M & A events, and the the different acquisitions subject, type and industry analysis. The results show that: M & A events occurred in general to improve the company's performance, including mergers and acquisitions of state-owned listed company performance significantly higher than the non-state-owned listed company M & A performance; shareholders of the target company in the M & A events higher than the acquisition of the company. Merger Performance; M & A performance of listed companies in mergers and acquisitions obtained from the vast majority of non-competitive industry M & A events occurred; foreign mergers and acquisitions have generally received lower performance.
Listed Companies [J]; Merger Performance; state-owned enterprises; reform; Empirical Comparison

Background
"Performance of Domestic M & A events is the most important issue in the M & A Research. The past 30 years, the academic circles at home and abroad have done a lot of research on M & A performance, however, has yet to form a consensus.
Sample of M & A Performance of Chinese scholars in the past mostly taken from company mergers and acquisitions from 1998 to 2005 occurred in China's capital market events, and does not accurately reflect the current practice of Chinese Listed Company M & A activity.
I believe that the empirical analysis of mergers and acquisitions of listed companies should be established on the basis of the 2007's mergers and acquisitions practice. This article is selected sample representative of mergers and acquisitions in the 2007 stock market empirical test to examine the change of the M & A performance of listed companies in China in the new period, especially the state-owned listed companies and non-state-owned listed company M & A event distinction and a comparative study, expect some innovative conclusions.

Research concept definition and methods of design
Define the concept of mergers and acquisitions by state-owned listed companies and non-state-owned listed companies. In this paper, due to the availability of information, authoritative, and the representative listed companies in Shanghai and Shenzhen A-share market is chosen as the object of study overall, I as a division of state-owned enterprises and non-equity structure of listed companies the basis of the state-owned enterprises. According to the capital structure of listed companies to provide the GTA CSMAR database and huge influx of information network (http / / www.cninfo.com.cn), the top ten shareholders and other data, mergers and acquisitions of state-owned enterprises and non-state-owned enterprise mergers and acquisitions, make the following definition:
(1) in the circulation of the total share capital, mergers and acquisitions involving listed companies, state-owned and state-owned legal person shares more than 51% of the total share capital.
(2) mergers and acquisitions involving the largest shareholder of the listed company to the need for the state-owned holding company.
Company to meet the above conditions, depending on its takeover of state-owned listed company mergers and acquisitions; Conversely, compared with the non-state-owned listed companies in mergers and acquisitions.
2. Statistical methods and tools introduced. In this paper, the event study method, the M & A events announcement for the first time is defined as 0, the entire event period (-40,40), from 40 days before the announcement to 40 days after the publication date, a total of 81 days. Cleaning period (-241, -41) from 241 days before the announcement to 41 days before the announcement, a total of 200 days. In addition, in the analysis process, we will be the event of further finely classified into two categories: the first category comprises: (-40, -31) (-30, -21) (-20, -11), (-10, -1), (1,10), (11,20), (21,30), (31,40) of eight events phase. The first four events before the stage, after 4 events later stage. The second category includes: (-40,40), (-30,30), (20 ,20), (-10,10), (-1,1) a total of five events stage. Availability to shareholders of the acquiring company and the target company over a period of time before and after the merger announcement abnormal returns, we study and calculate the size of the cumulative abnormal return (CAR) to determine the level of M & A performance by comparing CAR size.
Microsoft Excel2003 and SPSS13.0 software based on the above method, empirical research on the market reaction of the listed company M & A events.

Third, data sources and sample selection
A listed company data sources. We choose the listed company data derived from market transactions Shenzhen GTA Information Technology Co., Ltd. the development of CSMAR series study database running on a database, financial annual report database, years in quarterly announcement date database dividend database, placing additional database mergers and acquisitions database and split share structure reform database, as well as CHINF (http / / www.cninfo.com.cn) sorted out by several securities professional website Basic information of listed companies.
Stock price data sources. Stock price data used in this article event study include: the daily closing price of the daily closing price of the daily closing price of the Target Company of Shanghai and Shenzhen, the Shanghai A-share index, and deep into the A-share index. The great wisdom of all the data from the software company the great wisdom Software published, the stock price data, and download the from great wisdom software company pages.
Data screening criteria. When the in select target company sample, using the following criteria:
(1) as defined in the M & A event listed companies in a wide range of mergers and acquisitions of major securities newspaper announcement event, M & A scale must achieve more than 10% of the target company.
(2) will be the first listed company announced the announcement date of the change of equity defined as 0, the selected target companies in the announcement must have 241 consecutive trading day data, after the publication date of 40 consecutive trading day data plus the announcement date of the data, a total of 282 closing price data.
(3) within 40 trading days before and after the change of equity, there is no other significant events (such as published the annual report, the placement of shares, dividends, bonus shares) in listed companies announced. All companies must be 40 trading days prior to the change of equity to complete the split share reform has yet to implement the split share structure reform of the company to be removed.
(4) the same succession of M & A activity, the time interval must be greater than 40 consecutive trading days.
Samples meet the above criteria shall be maintained, or be removed.
Results of sample data. According to the criteria set out, we got 194 sample data, and a brief breakdown of the acquiring company and the target company. The acquired companies 104 samples, target company 90 samples, the acquisition of the company a little more than the target company.

Fourth, the empirical results and compare analysis
1 state-owned listed company M & A Performance of empirical results with statistical conclusions
Table 1 is based on the estimate of the cumulative abnormal returns event study method to calculate the state-owned listed companies.

As can be seen from Table 1, the state-owned listed companies in mergers and acquisitions in the various lengths events in 2007 midterm significantly positive cumulative abnormal return rate (CAR). Moreover, CAR is basically with the corresponding increase in the event of prolonged. It can be concluded that the M & A events of the company's share price to obtain the abnormal growth, shareholders benefit significantly from the M & A events.
From the classification of the acquiring company and the target company, the target company abnormal yield was significantly higher than the company's acquisition, which confirmed the previous empirical findings. The target company obtained in four of five events midterm abnormal rate of return higher than the acquisition of the company, the shareholders of the target company in a merger event to get higher returns.
Analyze the various events of the data, we found that the CAR of the acquiring company and the target company in the period around the event period (-30,30) reached the highest. The more rapidly the reaction of the market for the acquisition of company mergers and acquisitions event within the event period (-1,1) CAR reached 1.6686, significantly higher than the same period of the target company's CAR. But the goal of the company is in the the longer the event the midterm CAR growth of fast.
The first half of the table reflect different length event the performance of the mid-term performance of mergers and acquisitions, while the lower half shows the different stages of market events before and after the reaction of the M & A events, including a total of (-40, -31), (-30, -21), (-20, -11), (-10, -1), (1,10), (11,20), (21,30), (31,40) in eight stages CAR data.
Analysis table of data, we found that companies in M ??& A events before and after the high CAR, and no significant time distribution. This shows that the listed company M & A information leak prematurely, excessive market rumors or true or false interference in the stock price. China's stock market information disclosure mechanism still is not perfect, and to some extent affected the healthy operation of the market. Therefore, we have chosen (-40,40) event longer period is appropriate and necessary. No event longer period, will not be able to obtain a high degree of data fitting with reality.
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