Purpose/Significance This paper intends to examine the impact of venture capital withdrawal on the performance of listed companies, and explore the impact of venture capital withdrawal on the long-term performance of listed companies and its mechanism.
Method/Process This paper reviews the impact of VC withdrawal on the performance of listed companies at home and abroad by taking 571 listed companies listed on the GEM from 2009 to 2016 as samples to construct a multivariate regression model.
Result/Conclusion The study finds out that: 1) The withdrawal of VC will bring about a significant negative impact on the performance of listed companies, mainly due to the decline in the assets and capital utilization of listed companies. 2) The withdrawal of VC will have a significant negative impact on the long-term performance of listed companies. The decline in performance in the first year after the withdrawal of VC will be caused by a common decline in the rate of earning before interest and taxes (REBIT) and total asset turnover(TAT); and the poor performance in the 2-4 years after the withdrawal of VC will come from the continued decline in TAT.
DownLoad: