Abstract: This paper selects A-share listed companies in Shanghai and Shenzhen from 2008 to 2019 as samples to analyze the influence of major shareholders' equity pledge on corporate M&A decisions based on the pledge motivation. The results show that equity pledge, if supported by large shareholders, will significantly inhibit the probability and frequency of M&As, and if not supported, will do the opposite. Mechanism test shows that equity pledge, if supported, will significantly inhibit agency problems and reduce tunneling behavior, and if not supported, will do the opposite. We further find that a structure composed of multiple large shareholders can effectively play a governing role, mainly through active voice rather than exit threat. Heterogeneity analysis shows that:(1) compared with equity pledge supported by controlling shareholders, equity pledge supported by non-controlling shareholders has a stronger inhibitory effect on M&A decision-making, but equity pledge not supported by controlling shareholders has a significantly stronger promoting effect on M&A decision-making; (2) equity pledge supported unilaterally has a more significant effect in promoting M&A decision-making, while equity pledge supported by neither controlling shareholders nor non-controlling shareholders has a stronger effect in inhibiting M&A; (3) compared with additional pledge, major shareholders' first pledge on their own initiative has a more significant impact on M&A decisions; and (4) compared with state-owned enterprises, equity pledge of major shareholders has a more significant effect on M&A decision-making in non-state-owned enterprises. From the perspective of equity pledge motivation and multiple major shareholders' governance, this paper enriches the research on equity pledge and M&A decision-making, and provides reference for how to prevent the risk of pledge from the perspective of motivation.

Key words: equity pledge, capital flow, M&A decision, multiple large shareholders