A Study On The Ways And Effects Of Benefit Delivery In Yanhua Intelligent’s Private Placement

With the smooth progress of the split share structure reform,private placement has gradually replaced the rights issue and public offering with its low issuance cost,low information disclosure requirements,no profit requirements,simple audit procedures and other characteristics,and has become the preferred way of equity refinancing in China.Listed companies can solve the company’s financing problems,absorb high-quality assets and expand the industrial chain through private placement,which plays a positive role in the company’s rapid and sustainable development.However,the late development of private placement in our country,coupled with the imperfect capital market in our country,has led many companies to use the financing advantages of private placement to transfer benefits,which not only has not played a good role in promoting the healthy and sustainable development of the company,but also has seriously damaged the interests of small and medium shareholders,at the same time has seriously damaged the credibility of listed companies and hindered the healthy development of the capital market.Based on the relevant theories of private placement,according to the current situation and existing problems of private placement,this paper takes yanhua smart company,which was the first to propose "smart city" in our country,as the case study object,and analyzes whether the major shareholders of the company carry out interest transmission through the financing method of non-public offering of shares.On the basis of analyzing the background and motivation of this private placement,it is found that Yanhua Intelligent’s major shareholders have the following behaviors of transferring benefits:First,in terms of new share pricing:Yanhua Intelligent chose the announcement date of the board resolution with the lowest issue price,and greatly reduced the cost required by major shareholders to subscribe for new shares by conducting a long-term suspension of trading and implementing a profit distribution plan at a favorable opportunity.Secondly,Yanhua Intelligence implemented high cash dividends after the private placement,and large shareholders frequently pledged their shares to finance after the private placement,which resulted in the transfer of benefits to themselves,enabling them to recover their investment costs in advance and avoiding the risks caused by stock price fluctuations during the lock-in period.Finally,the event analysis method is used to analyze the short-term announcement effect brought by the private placement,and the financial indicators are used to analyze the impact of the profit transmission behavior on the profitability of the company and the small and medium shareholders.Through analysis,it is concluded that Yanhua Intelligent’s major shareholders did deliver relevant benefits through private placement,which not only harmed the interests of small and medium-sized shareholders,but also damaged the operation of the enterprise,and was not conducive to the long-term development of the company.Through analysis of the ways of delivering benefits and the economic consequences of delivering benefits during the process of private placement,this paper puts forward relevant policy suggestions,mainly including:perfecting the pricing mechanism and relevant laws and regulations of private placement,strengthening information disclosure,standardizing asset evaluation behavior and establishing a protection mechanism for small and medium-sized shareholders,so as to promote the healthy and sustainable development of the capital market.