Research On Reasons?Paths And Effects Of Market-Oriented Debt-to-Equity Swap

As China's economic development has entered the "new normal",the past model of relying on investment and leverage to drive rapid economic growth is no longer sustainable.The excessive leverage ratio of non-financial corporate sectors,especially state-owned enterprises and central enterprises,has gradually attracted the attention of all sectors of society.How to effectively reduce leverage through market debt-equity swap and promote the sustainable development of enterprises has become a hot topic in economic market research.This paper focuses on the marketization of China railway bonds convertible project,launched the following research: a,through literature research and comparative analysis on the one hand,for our country to carry out the two rounds of debt generalizes the stock rights,clear up the marketization characteristics of the debt-equity swap and the "two-step" debt turn new model,and the implementation of the status quo for analysis;On the other hand summed up the United States,Poland and Japan's practice experience of debt-equity swap.Second,the case study method is adopted to first sort out the operation steps of the project.Secondly,it analyzes the causes of participation of all parties,the pricing strategy of equity conversion adopted by the enterprise and the key points for the successful implementation of the project.Finally,the implementation effect of the project is analyzed from the perspectives of market response,financial performance,equity and governance structure.One of the conclusions of the study is that from the perspective of the mode selection of debt to equity swap,China Railway's market-oriented debt to equity swap seems to be a separate two-step process on the surface,but in essence,its value logic is that institutional investors purchase the listed and circulating equity of China Railway with monetary capital.Therefore,the two steps are simultaneous and inseparable,which should be considered as a step of merger in the analysis process.Second,China Railway has created short-term income for investors in the short term,and its solvency,operation ability and profitability have been greatly improved.The participation of institutional investors has also made the equity structure of China Railway more diversified,multi-level and reasonable.Third,China Railway has basically realized marketization in the selection of participants,share transfer pricing and exit mode,which is worth learning from other companies.