A Case Studying Of Debt-to-equity Swap Of SINOSTEEL Under The Background Of Structural Reform Of The Supply Front

As a financial instrument,debt-for-equity swaps often accompany economicstructural reform.Policy-based debt-to-equity swaps began in Latin America in the late 1970 s and early 1980 s,stemming from a severe external debt crisis in the region.Into shares in debt for the first time in our country in 1998,before and after the excess capacity,inadequate capital and excessive investment and bank defective rate rise,many structural problems are floating on the water lead to slow economic growth.In 1998,the central economic work conference decided to set up a financial asset management company to restructure a large number of bad debts.Debt-for-equity swaps are one of the most important ways to restructure debt.The debt ratio of enterprises has fallen significantly,the interest burden is greatly reduced,the enterprises operating in the business can turn a profit directly,and the bank is also able to repair the balance sheet due to the stripping of the huge non-performing assets.Since 2010,the traditional steel and coal industry has turned into a long recession due to overcapacity.This paper first introduces the concept of debt-to-equity,as well as the situation of the research object and the change of the industry cycle.And then turn to sinosteel debt stocks were analyzed,research its financial data and operating conditions,and make a horizontal contrast,the iron and steel industry with the debt convertible corporate longitudinal comparison,self contrast,combing and analysis of existing data,it is concluded that the sum of the convertible bond par value and option value,under the background of macro cycle based on enterprise development situation,convertible bonds form of debt-for-equity,through the analysis of the binary tree of debt of stock pricing.In the case of the debt-for-equity exchange,the analysis of the change of enterprise EVA,by examining the correlation between EVA and the excess yield,is used to judge the performance of the shares of sinosteel.Further,whether the debt-for-equity operation is successful,and relevant adjustment proposals.Finally on the supply side,under the background of structural reform,assessment of financial tool to leverage the macroeconomic recovery effect,the relevant conclusions,to the form of a debt-for-equity,objects,and depth of its recommendations.