The Case Study Of Private Equity Funds Investment By Corporation

Private equity originated from United States in 1940s.It played an important role during the development of capital market.Compared with western countries,Chinese private equity funds started late but have achieved a lot with the economic development,capital liberalization and other political supports from the government and society.From a macro-economy perspective,the private equity is conducive to improve the national industrial structure,enhance industry integration,and improve the capital utilization efficiency.From the micro perspective,it provides financing support to projects for company developments,perfecting the corporate governance structure,and achieving innovation of enterprises.Private enterprises play an important role in economic development by operating flexibility,and decision-making efficiently.Currently,many private enterprises have carried out cooperation with private equity in order to achieve a win-win situation for their development and the private equity itself.This paper selected Shandong Tianye Group as research object and analyzed its practice of using private equity and analysis of how the group company participates in private equity fund investment based on the theory of private equity and the domestic and foreign literature.Then combined the development process and current situation of China private equity,concluding the favorable conditions of the development of private equity funds and corporation in the process of cooperation and the problems of private equity fund development and the a clear understanding of using private equity to develop private enterprise.In the process of analysis,this paper focuses on the use of case study,literature research,comparative analysis,qualitative and quantitative analysis and other research methods.Through the researching and analyzing,this paper argues topics like the perfection of the capital market,economic development,the introduction of relevant laws and regulations and regulatory policy,capital supply and exit path,rapid growth of private equity with professional institutions and personnel,the investment amount,the amount of fund-raising and the numbers of investment cases have reached a historical peak.However,there are still some problems in the practice of private equity,such as wrong choice of investment horizon,lack of investment management,inappropriate of abandoning path and timing.Private equity fund is mainly used by Tianye Group for investment in Internet,finance,and other areas such as energy or high quality mineral enterprises,including medical group project and Qihoo 360 project.Tianye Group promotes its development by using the private equity,and achieved higher capital gains,enhanced the company's profitability,and gained returns for the shareholders.Through more detailed and practical information,we have a clearer understanding of how privately-owned group companies participate in private-equity fund investments.It also provides a reference for how to use the private equity for other enterprises.