Comparison Of The Motivations And Characteristics Of SAIC Motor's Two Fixed Increases

Shanghai Automotive Group Co.,Ltd.("SAIC",stock code 600104)is a local state-owned listed company in Shanghai,the vehicle production and sales scale of SAICmaintain the leading of domesticautomobile market and its domestic automobile market share is of 23.2% at end of 2015.SAIC is the largest automobile group,but also the domestic A-share market value of the largest car listed companies.To achieve the overall listing,SAIC Group start asset acquisition-oriented private issuein November 6,2015,SAIC released funds to raise Private Equity Financingplan and completed the fund raising in January 2017,The bid issuer is a non-affiliated institutional investor,and the parent company and employee shareholding plan do not participate in the auction.SAIC's two Private Equity Financing is not a simple refinancing behavior.In 2011,the Private Equity Financing is based on the overall listing purpose.The Private Equity Financing in 2015 will also achieve project financing,parent holdings and employee holdings.The general refinancing tools Such as allotment,public issuance,ordinary bonds,convertible bonds,etc.,and can not achieve the overall market,the purpose of staff incentives.Therefore,for this case,the two Private Equity Financing is essentially the company's strategic tools of SAIC Group.This paper is a case analysis.Taking Shanghai Automotive Group Co.,Ltd.as an example,this paper analyzes the motivation and characteristics of the two Private Equity Financing in 2011 and 2015 from the external environment(macroeconomic policy,economic situation,automobile market situation,The consumer market conditions,the securities market conditions)and the internal environment(the company's own strategy,the existing problems)comparative analysis of the two Private Equity Financing of strategic objectives and strategic tools to select the motivation and found that SAIC's two Private Equity Financing are responding to the national call,Conform to the securities market situation.The two strategic objectives of the different motives for: different economic conditions,the prospects for different industries to meet different consumer demand and based on different development goals.This paper mainly studies the two characteristics of " Over-financing " and " Benefits Expropriation " in the process of Private Equity Financing.By comparing the sustainable growth rate of 2010 and 2015 with the actual growth rate,this paper found that SAIC 2011 Private Equity Financing as a whole from the perspective of sustainable growth is the right decision,this time the company's internal resources is hard to support the rapid growth of the sales;However,SAIC's Private Equity Financing in 2015,from the perspective of sustainable growth,high dividends is already "Over-financing."This paper argues that the agency theory can explain the characteristics of the proceeds of the acquisition in 2011.The information asymmetry theory can explain the Benefits Expropriation characteristics of SAIC-funded Private Equity Financing in 2015.In addition,the earnings management of the earnings management model(modified Jones model)found that earnings management in different directions may be SAIC 2011 and 2015,the expropriation way to the parent company SAIC and Industrial Co.,Ltd.When the acquisition of its operating assets,process the negative earnings management.When issue new shares to raise funds from non-affiliated investors,process the positive earnings management.With the development of the automobile industry,the manufacturing industry,especially the automobile manufacturing industry is the pillar industry of our country.SAIC,as the "vanguard" of the domestic automobile manufacturing industry,should be supported by the state and the investors,But the "Over-financing" issues and " Benefits Expropriation " issues that also need to be highly valued by regulators.