Research On Cash Cow Business Development Strategy Under The Gambling Agreement

The gambling agreement appears as an general commercial clause in the investment agreement for private equity investment.When the investment and financing parties reach the merger and acquisition agreement,they make a gamble on the uncertainty of the future development of the company.Within the time agreed in the agreement,When the financing party reach the agreed standard,the investor will give its financing party proper incentives;on the contrary,the financing party will give the investor certain compensation.This thesis combines theoretical analysis and case studies to analyze the cash cow business under the gambling agreement,tries to find solution for the following three questions:(1)What is the motive for the financing party with a cash cow business to sign a gambling agreement? The gambling agreement is obviously more favorable to investors,with advantage of capital,investors have more power when setting gambling terms,and most of the risks are borne by the financing party.Under such situation,why financing party with cash cow business still sign the gambling agreement?(2)Why necessary for the gambling parties to jointly protect and develop the cash cow business? In general,the operation mode and management mechanism of the cash cow business have been relatively mature after years of accumulation.With its industry status and net cash inflow ability already valued,why should we pay special attention to protect and develop the cash cow business after signing the gambling agreement?(3)How gambling parties protect and develop the cash cow business when signing and executing gambling agreements? What are the risks for the cash cow business under the gambling agreement and how to design corresponding development strategies to avoid it?This thesis summarizes the research results of domestic and foreign scholars on the gambling agreement from the perspective of economics,focuses on the theoretical background of research method.Based on the Boston Matrix,divided the financing business line and focus on the cash cow business.Based on the internal capital market theory,corporate value assessment theory,risk management theory and preferential financing theory,deeply analyze the development strategy of the cash cow business under the gambling agreement.The research conclusions of this thesis are:(1)The cash cow business is the bottom line for the investment and financing parties,should be protected;(2)Both sides can jointly protect and develop the cash cow business in terms of gambling,enterprise valuation,corporate governance and incentive mechanism.