Abstract: In recent years, due to the declining market demand and the ongoing decline in profit margins of domestic real enterprises, real enterprises have become increasingly inclined to shift their investment enthusiasm from the real economy to the financial asset field, resulting in an increasingly obvious trend of domestic real enterprises shifting “from real to virtual”. The corporate financialization is a micro manifestation of the problem of “from real to virtual”. Excessive financialization causes non-financial enterprises to keep unreasonably high levels of financial assets, which increases their dependence on the returns from financial investment. In a long term, it will not be helpful for the growth of their main businesses and value enhancement in the future, and will pose a challenge to whether China’s economic growth can smoothly complete the shift from “factor driven” to “innovation driven”. According to the existing research, the financialization of enterprises has a “crowding out” effect and a “reservoir” effect on real enterprises. The “crowding out” effect is the decrease in the rate of industrial investment caused by the increase in corporate financialization. The “reservoir” effect is that the financial asset allocation of real enterprises can mitigate their financial difficulties and further promote industrial investment. The corporate financialization can also affect their business performance, investment efficiency, asymmetric cost behavior, and innovation behavior.
Mergers and acquisitions (M&A) are not only a capital operation method for enterprises to recombine assets and expand asset scale, but also a crucial means for enterprises to seek strategic layout, look for development opportunities, assist in rapid growth, and enhance competitiveness by strengthening resource integration. They play a crucial role in encouraging industrial structure upgrading and promoting long-term development of enterprises. As a high-risk economic activity, mergers and acquisitions often face failure risks from various aspects such as agency issues, financing constraints, lack of experience, and information asymmetry during the process. Correspondingly, this process itself is also an assessment of enterprise’s full range of capabilities. The enterprise manager serves as the primary decision-maker in investment decisions involving mergers and acquisitions, and the varied traits of the manager directly impact on such decisions. Many studies have been conducted from the perspective of management, suggesting that factors such as demographic and irrational characteristics of executives have a significant impact on corporate mergers and acquisitions behavior.
We consider that M&A are a high-risk activity, and the occurrence of M&A activity is influenced by various factors. Because of the increasingly visible phenomenon of excessive corporate financialization, it is not favorable to the future development of the main business of real enterprises and the improvement of long-term value. This result may negatively impact the M&A behavior of enterprises. Consequently, this paper examines the mechanism of impact of the corporate financialization on M&A activity from that perspective. The research conclusion broadens the discussion about the factors influencing M&A activity, and can provide a valuable reference for listed companies to initiate M&A activity. Based on the above analysis, this paper selects A-share listed companies in Shanghai and Shenzhen from 2007 to 2019 as research samples, empirically analyzes the impact of corporate financialization on M&A activity, and further constructs a mesomeric effect model to test whether financing constraints have a mediating role in the above relationship.
The empirical results indicate that there is a significant inverted U-shaped relationship between corporatefinancialization and M&A activity. When corporate financialization is in a lower range, the increase in corporate financialization will promote M&A activity. On the contrary, excessive corporate financialization will do otherwise. Mechanism testing shows that corporate financialization affects M&A activity through financing constraints. Moreover, financing constraints exhibit a masking effect between corporate financialization and M&A. After considering possible endogeneity issues, changing the model, and changing the measurement methods of the main variables, the results of this paper are still robust.
This study has the following implications: Firstly, a correct understanding of the impact of corporate allocation of financial assets on M&A activity. Financial assets have the dual characteristics of high risk and high return. Although financial assets can be quickly realized in the short term, improving the profitability of enterprises, alleviating financing constraints, and providing financial support for enterprise M&A activity, excessive allocation of financial assets can lead to a shift in the expansion strategy of enterprises towards financial profits, resulting in a dilemma of idle resources in the financial sector and ultimately affecting corporate M&A activity. As the main body of investment decision-making, the management should comprehensively consider various factors of the enterprise, based on the actual development needs of the enterprise, carefully allocate financial assets, and avoid blindly pursuing excess profits of financial assets and deviating from the main business development. Secondly, it is necessary to pay high attention to the “crowding out” effect of corporate financialization. The financialization of enterprises usually focuses on the “reservoir” effect, but there is also a certain “crowding out” effect on the real economy. If the “crowding out” effect is not taken seriously, as the degree of corporatefinancialization increases, the investment in the real economy of enterprises decreases, and the risk of excessive financialization increases. Therefore, when formulating macroeconomic policies, the government should pay high attention to the “crowding out” effect that the virtual economy brings to the real economy.

Key words: corporate financialization, M&A behaviors, financing constraints, inverted U-shaped relationship

摘要： 近年来,国内实体企业“脱实向虚”趋势日益明显,导致企业过度依赖金融资产获利。本文利用2007~2019年沪深A股上市公司数据,实证研究企业金融化对并购行为的作用机制。结果表明企业金融化与并购行为之间存在倒U型关系。当企业金融化处于较低范围时,企业金融化的增加会促进并购行为。相反,过高的企业金融化会抑制并购行为。机制检验表明,企业金融化通过融资约束影响并购行为。而且融资约束在企业金融化与并购行为之间表现为遮掩效应。在考虑了可能的内生性问题、改变模型和更改主要变量衡量方法后,本文结果仍然是稳健的。

关键词: 企业金融化, 并购行为, 融资约束, 倒U型关系