Research On The Causes Of Private Placement And The Economic Consequences Of Listed Companies

Refinancing of listed companies is a powerful assistant to promote the growth of enterprises.Among the many refinancing methods of enterprises,since the private placement has been confirmed in the document of the CSRC in 2006,the domestic capital market has set off a wave of private placement financing.The number of listed companies and the amount of financing to adopt the private placement and refinancing once showed a blowout.The growth of the type of listed companies using private placement financing has also received high attention from all parties.With the development of the market economy,the directional private issue has exposed more and more problems.In 2017,the new regulations issued by the China Securities Regulatory Commission and the new regulations of the directors and supervisors have once again made the private placement of listed companies a hot topic.Therefore,based on the existing research of scholars at home and abroad,the author takes K company as an example to conduct research on the motivation and economic consequences of private placement,in order to inspire K company,small and medium investors and regulatory authorities.This paper first defines the concept of private placement and economic consequences,and analyzes the overall situation,motivation and possible problems of private placement of listed companies based on relevant theories,laying the foundation for the following specific analysis.The theoretical part mainly includes information asymmetry theory,signal transmission theory and principal-agent theory.The motivation for the issuance is mainly from the internal and external environment of the company.The main problems are the manipulation of the stock price,the interest transfer and the quality of the stock market.Secondly,taking K company as an example to analyze the process and fund use of K company's five private placements from 2011 to 2017,which derived the possible drivers of K company's private placement,including the need for scale expansion and the introduction of strategic investors.And release positive signals to the market.In this paper,the event research method and financial index method are used to study the economic consequences of K company's private placement.In the analysis of financial indicators,the industry average value is selected for comparative analysis,and the long-term non-financial effect brought by K company's private placement is analyzed.The conclusion of the study is: K company's short-term financial effect is positive,and its long-term financial effects are uneven.At the same time,continuous private placement promotes the progress of K's core technology and exacerbates the problem of principal-agent between controlling shareholders and minority shareholders.The construction of the marketing platform has led to a surge in sales expenses,which is not conducive to corporate research and innovation.This paper puts forward three suggestions: First,K company needs to formulate a diversified refinancing policy;second,investors should establish a correct investment philosophy;three points are to improve the external supervision mechanism.