This paper constructs a model of the choice of payment contract in mergers and acquisitions(M&A) and studies enterprises’ attitude toward how to choose payment contract, which include cash, stocks and a combination of cash and stock from the perspective of controlling shareholder. The results show that there exists an equilibrium solution of a combination of cash and stocks under the condition of private benefits of control. This model demonstrates how the shareholding, the balance of power, shares centralization, relative deal size and the correlation of industry have effect on the preference of payment contract. We found out that controlling shareholder of acquirers has preferences to cash payment contract to protect private benefits of control and preferences to stock payment contract to avoid future risks.