Political Connections, Conglomerate Diversification and Acquisition Performance
WEI Wei，ZHU Qingyuan，LIN Guiping
1.Peking University HSC Business School, Shenzhen, Guangdong, China; 2. Roland Berger Enterprise Management (Shanghai) Co. Ltd., Shanghai, China; 3.Shenzhen Yuanzhi Business Model Research Institute, Shenzhen, Guangdong, China
Abstract This article makes a comprehensive study on the relationship between political connections and acquisition performance. The relationship is investigated from the following aspects: the general effect of political connections on acquisition performance; the different effects of political connections on SOEs and private enterprise’s acquisition performance; the combined effect of political connections and conglomerate diversification on acquisition performance. Our findings show that political connections have a negative effect on acquisition performance；political connections have a significant negative effect on acquisition performance of SOEs, but less negative effect on private enterprises’; companies with political connections have better acquisition performance than those without political connections when they are making conglomerate diversification, and this positive effect performs better on private enterprises.
2017, Vol. 14 
