Research Of The Impacts On The Long-term Performance Of Private Placement In Listed Manufacturing Companies

Since May 2006, the "Measures for the Administration issued securities of listed companies" made specific provisions of private placement, due to the lower threshold of the private placement, simple issuing procedures, short processing time and other advantages, much favored by enterprises. It has accounted for up to 83.43% of the total private placement financing from 2006 to 2014, it is becoming the main form of equity financing, and listed manufacturing companies reached 42.18% particularly. Private placement has its own characteristics in object, the discount rate, exchange methods, so this paper research the long-term impact on the business performance of from the subscription, the discount rate, the exchange methods three aspects, which has a certain significance and practical value.This paper selected 223 listed manufacturing companies in Shanghai and Shenzhen A-share market as research sample from 2010 to 2012, and used 2007 financial datum from 2009 to 2014, to study the impacts of the characteristics of private placement, including private placement objects、pricing discount rate、exchange methods on the corporate long-term performance. Firstly, based on the analysis of the asymmetric information theory, earnings management hypothesis, cash flow and other private placement hypotheses, proposing three hypotheses about private placement objects, pricing discount rate, exchange methods impacts on the long-term performance. Secondly, to establish the model, which defined private placement objects, discount rate, exchange methods as independent variables individually, and choosing the difference between the average ROA of year and followed by two years of placement and a year before placement as the dependent variable. Finally, results found that the long-term performance decreases remarkably after placement; the participation of major shareholders is positively related to the corporate’s performances; the discount rate has obviously negative relation with the performance; the companies which have been invested with cash assets have obviously worse performance than which invested by others. In inclusion, by analyzing these results, this paper further puts forward relevant explanations and political suggestions.