关键词: 超额商誉, 非效率投资, 风险承担, 融资约束

Abstract: Merger and acquisition (M&A) is an efficient and innovative way for China’s listed companies to achieve industrial innovation, enhance growth, and explore new profit growth source, which has been hot among enterprises. However, irrational mergers and acquisitions can lead to companies facing high goodwill issues, which not only make it difficult to meet excess profit expectations, but also lead to tricky challenges for acquirers. Goodwill consists of reasonable and overestimated portions, and the overestimated portion corresponds to the excess goodwill in this paper. Due to information asymmetry, principal-agent issues, and irrational factors in M&A transactions, acquirers may overestimate the post-merger synergies and thus pay high premiums in M&A, which is the case for the excess goodwill in this paper. In terms of inefficient investment, scarce resources for investment have been crowded out by excess goodwill, which can lead to the passive abandonment of high-quality investment projects and reduce investment efficiency. At the same time, excessive goodwill puts management under pressure from high expected profits and threats to jobs, and agency problems motivate them to invest inefficiently to meet excessive profit expectations and pursue self-interested motives. Therefore, the relationship between excess goodwill and inefficient investment in Chinese A-share listed companies deserves further exploration. How to avoid the negative economic consequences of excessive goodwill is also an issue that needs attention.
To explore the impact of excess goodwill on inefficient investment, this paper empirically tests the relationship from the perspective of risk-taking and financing constraints, based on data from 2007 to 2018 for A-share listed companies in China. Specifically, this paper uses a multivariate regression analysis to verify the correlation between excess goodwill and inefficient investments. This paper then empirically tests the mechanism of influence between excess goodwill and inefficient investment using a Mediating Effect Test model. Since the excess goodwill in this paper is defined as the difference between the actual goodwill size and the reasonably expected goodwill of the acquirer business, the residual measurement model can more quantitatively reflect the definition in this paper. Thus, the regression residuals of the goodwill expectation model are used as the variable for the excess goodwill in this paper. In addition, Richardson’s expected investment model is used to calculate the expected investment levels of the sample firms, and the residuals of this model are used to measure inefficient investment.
It has been shown that excess goodwill has a significantly positive effect on inefficient investment, over-investment and under-investment. Risk-taking acts as an intermediary between excess goodwill and over-investment. Specifically, excess goodwill enhances a company’s risk-taking, thereby exacerbating its over-investment. At the same time, financing constraints act as an intermediary between excess goodwill and under-investment. Excess goodwill exacerbates corporate financing constraints and leads to under-investment. Corporate social responsibility disclosures can constrain the positive correlation between excess goodwill and over-investment. The paper enriches and expands the economic consequences, transmission pathways and governance measures for excess goodwill, and also provides targeted guidance for enterprises to optimize investment efficiency.
As far as the M&A process is concerned, the expected synergies of the M&A should be reasonably assessed and the M&A premium should be reasonably paid. After M&A, enterprises should actively integrate with the acquired parties to achieve optimal resource allocation and ensure that the synergies from M&A are truly translated into value creation from M&A. In future research, it would be worthwhile to investigate normative policies for accounting information and non-financial information disclosures related to mergers and acquisitions.

Key words: excess goodwill, inefficient investment, risk-taking, financing constraints