Trust, innovation and M&A value: An empirical study in China

This paper analyzes the relationship between trust mechanism, innovation ability and M&A value by employing the data of major assets restructuring mergers & acquisitions (M&A) by China's listed companies. This paper finds that the improvement of innovation ability affects the M&A value, and it relates closely to trust mechanism. Two stage least square regression results show that internal trust mechanism with the sincerity of firms as core is utilized constantly by promoting knowledge inside and outside the organization to enhance the innovation ability of the firms. This paper indicates that the firms can still create M&A value through sincerity construction and innovation ability improvement though China's system environment is not perfect. (c) 2021 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license (https://creativecommons.org/licenses/by-nc-nd/4.0) Peer-review under responsibility of the scientific committee of the International Conference on Identification, Information and Knowledge in the internet of Things, 2020.