企业兼并后财务状况分析外文翻译（已处理）.docVIP

企业兼并后财务状况分析外文翻译 Firm Financial Performance Following Mergers 2. Hypotheses 2.1. Long-term performance plans The interests of managers and stockholders can potentially be aligned by management compensation plans. Long-term performance plans may lengthen a manager’s decision-making horizon since the performance plan compensation is deferred until the end of the award period and forfeited if the manager leaves during the period. Managers who are compensated only by a salary and bonus program may have a shorter decisionmaking horizon. Smith and Watts 1982 suggest that short-term bonuses give managers incentives to choose negative net present value projects that impose expenses after the manager retires and to turn down positive net present value projects with a long horizon. The horizon issue is further examined by Narayanan 1985 whose model shows that managers select projects yielding short-term profits to enhance the perception of their ability quickly and thus earn higherwages. This might be done by managers even though the project is not the one with the highest net present value. Tehranian, Travlos and Waegelein 1987 provide evidence that firms with long-term performance plans experience more positive abnormal returns at merger announcements than firms without these plans. Thus, our first hypothesis is that firms who compensate their managers with long-term performance plans will experience more positive post-merger financial performance than firms that do not have these plans. 2.2. Method of payment The influence of method of payment on post-merger financial performance is ambiguous. Corporate finance theory suggests that the method used to finance a corporate acquisition should produce different valuation effects on the bidding firms’ stock prices because of signaling effects. The signalling hypothesis rests on the assumption that managers have inside information regarding the true value of the firm. This hypothesis predicts that managers, acting