| Summary: | 碩士 === 東吳大學 === 國際經營與貿易學系 === 101 === In recent years, Private equity funds invest increasingly in Asia, especially in emerging Asian markets. This study explores what motivates private equity funds to investment the target companies in financial services industry in Greater China (China, Hong Kong and Taiwan) from 2000 to 2012.Furthermore, this study also examines, with comparison with were investment affected the performance commercial banks and investment companies.
This study uses the binary and multiple logistic regression analysis to analyze the motives of private equity funds, commercial banks and other investment companies. This study also examines the target’ long-term and short term performance after private equity funds investments. In the short term, this study adopts event study to test if there are abnormal returns in the event window. And it also compared with companies which never engage in M&A activity. Finally, using private equity fund holding ratio to explore whether the ownership structure could affect the financial services company’s operating performance.
The results show that private equity funds tend to select target firms with poor-performance, growth-potential and smaller size companies to invest. After private equity funds investments, targets firms’ operating performance and future growth significantly are better than before. In the short abnormal returns, the cumulative average abnormal return of event windows (-25,-25), (-5,-1) and (-4, 0),(-1, 0) are significantly positive. Finally, private equity fund holding ratio is significantly positively to the Price-Book Ratio and ROE of the financial corporations.
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