Private Placement,Major Shareholder Subscription And Corporate Innovation

With the continuous development of the economy,the importance of innovation for the long-term development of enterprises has been self-evident.Only innovation can make enterprises stand out in the increasingly fierce competition and achieve the goal of becoming bigger and stronger.Therefore,it is imperative and urgent to stimulate the innovation enthusiasm of enterprises and improve their innovation ability.Compared with other countries,the overall innovation capability of Chinese enterprises needs to be improved.One of the constraints is the difficulty in financing corporate innovation funds.Studies have shown that equity financing is beneficial to enterprise innovation,and private placement is one of the main choices for corporate finance.Whether it will promote enterprise innovation is worth studying.The purpose of the article is to study the impact of private placement on corporate innovation,and on this basis,explore the role of major shareholder subscription.In order to verify whether there is a significant relationship between private placement and corporate innovation and the role played by major shareholders,the article conducts theoretical analysis and empirical analysis.The related theories mainly include principal-agent theory,information asymmetry hypothesis,supervisory effect hypothesis and interest encroachment theory.Through theoretical analysis,the easy accessibility of funds for this type of financing can stimulate the innovation enthusiasm of enterprises,reduce the degree of information asymmetry to a certain extent,improve the success rate of corporate financing,and provide material and financial support for the innovation activities of enterprises.The introduced strategic investors can also bring advanced management experience and optimize the corporate governance structure.The participation of major shareholders in private placements can increase the concentration of equity,ease the conflict of the first type of agency,and urge management to innovate to achieve the long-term development goals of the company.The empirical part takes the 2010-2017 Shanghai-Shenzhen A-share listed company as the research sample,and verifies the private placement,major shareholder subscription and enterprise innovation through descriptive statistics,correlation analysis,non-parametric test and multiple regression analysis.The correlation analysis initially confirmed that there is a significant positive correlation between the implementation of private placement and enterprise innovation.The results of non-parametric test show that the listed companies that have implemented private placements have higher average R&D investment and patent entitlement than the listed companies without private placement,and the differences are significant.Finally,the final conclusions are drawn through multiple regression analysis:(1)Private placement is positively related to enterprise innovation,and the relationship is significant.Private placement for financing can promote the R&D investment and innovation output of the enterprise,indicating that private placement can indeed stimulate the innovation power of the enterprise,and give the enterprise innovative support in human,material and financial resources to help the enterprise innovate.(2)The proportion of major shareholder subscriptions is significantly positively correlated with corporate innovation.The higher the proportion of major shareholder subscriptions,the more R&D investment and innovation output of enterprises,indicating that the participation of major shareholders in the private placement has played an “efficiency” role.With the increase in the proportion of major shareholder subscriptions,the higher the correlation between their own interests and corporate interests,the urge to urge management to commit to the long-term development of the company,and urge the management to focus on the cultivation of corporate innovation capabilities,improve corporate governance,and enhance the company.core competitiveness.(3)In the private placement,there is no significant relationship between the subscription mode of the major shareholder and the R&D investment and innovation output of the enterprise.The possible reason is that with the continuous improvement of relevant laws and regulations,the feasibility of large shareholders using non-cash assets to “short” listed companies is reduced,and they are more inclined to subscribe for private placements with “efficiency” motives.Therefore,the impact of two subscription methods on corporate innovation has no significant difference.Based on the problems found in the research process,the following suggestions are proposed: From the perspective of enterprises,enterprises should not rely too much on private placement for financing.Different financing methods should be adopted to give full play to the advantages of various financing methods.Private placement may intensify the second type of proxy conflict and which is also worthy of corporate attention.From the government’s point of view,we should constantly improve relevant regulations to regulate the operation of all aspects of the issuance of stock issuance,reduce the possible arbitrage space,and protect the interests of minority shareholders.In addition,the government should also adopt corresponding incentives to stimulate the innovation power of enterprises,improve the financial mechanism supported by corporate innovation funds,broaden financing channels,and innovate financing methods to make the collection of innovative funds more flexible and convenient to solve the problem of enterprise financing difficulties.