The impact of firm ownership, board monitoring on operating performance of Chinese mergers and acquisitions

Agyenim Boateng, Xiao Gang Bi, Sanjukta Brahma

Research output: Journal PublicationArticlepeer-review

16 Citations (Scopus)

Abstract

In this paper, we employ board monitoring mechanisms and within-firm governance variables to investigate the operating performance of 340 mergers and acquisitions in China over the 2004–2011 period. Our results document a significant deterioration in post-acquisition operating performance of acquiring firms over 12–36 months. We find independent directors, managerial shareholding, ownership concentration have a positive and significant impact on operating performance of acquiring firms. However, the related party transactions exert a negative and significant effect on matched control adjusted ROA. Further analysis of our sub-sample indicates that privately owned enterprises are better monitors compared to the state owned enterprises.

Original languageEnglish
Pages (from-to)925-948
Number of pages24
JournalReview of Quantitative Finance and Accounting
Volume49
Issue number4
DOIs
Publication statusPublished - 1 Nov 2017

Keywords

  • Firm ownership
  • Mergers and acquisitions
  • Monitoring
  • Performance

ASJC Scopus subject areas

  • Accounting
  • Business, Management and Accounting (all)
  • Finance

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