Impact of the Split-share Structure Reform on the Performance of Listed Companies

China's Split Share Structure was born with the China's security market, which was the property difference of the two kinds of stakes in circulation and transference on the Stock Exchange market: only the public shares taking 1/3 of the all could circulate, while the main part namely the state-owned shares and the legal person shares couldn't circulate normally as the public shares. This weaknesses have been the bottleneck of the China's security market since its born, and China Security Regulatory Commission has been trying to make this market "Malignant tumor" trivial over this years.

After substantial discussions and tests, the split share structure reform was launched in May 2005 and fully opened in August the same year. So far, the split share structure reform has been going on more than three years. Now, it has entered the stage of end. What it has brought to the China enterprise? Whether the enterprise's performance was improved after the split share structure reform?

The main purpose of this study is to find the answer to the above-mentioned questions. In this paper, the sample is composed by two groups. One contains companies having completed the reformation and the other contains companies without the reformation. This study uses the data from 2003 to 2007, and then will adopt the principal component analysis to gets 7 performance indicators. Finally, we will get the comprehensive performance score. At last I will compare the score horizontally, and compare five years' performance of the first group vertically. By analysis we can get the conclusion that the split share structure reform has improved the performance of the China enterprise. In the end I will describe the prospect of the split share structure reform and make some feasible suggestions.