Research On Major Shareholders Of Listed Companies Resolving The Risk Of Stock Pledge Closing

In recent years,pledge of stock rights has become a popular financing method because of its flexibility and convenience.With the new way of pledge of stock rights,many enterprises and shareholders of listed companies have solved their financing problems and released their liquidity.But as the other side of the double-edged sword of equity financing,it also has its own risks.After the major shareholders of listed companies pledge their shareholdings,if the stock market fluctuates sharply and the stock price of the pledged listed companies falls too much,the floating price of the pledged companies will fall below the warning line or even the liquidation line,which will lead to the risk of forced liquidation of the shares pledged by the major shareholders of listed companies.If the proportion of pledge of major shareholders of listed companies is too large,once the pledged shares are forced to liquidate,then the shareholders of pledged shares have the risk of losing the controlling rights of listed companies.Therefore,through in-depth analysis of the various risks brought by the pledge of stock rights financing of Kelu electronic major shareholder Rao Luhua and the risk response measures taken,this paper enriches the research on the risk of pledge of stock rights financing of Listed Companies in theory,and broadens the thinking and methods of resolving the risk of pledge of stock rights liquidation of listed companies' major shareholders in practice.This paper summarizes the financing risks brought by pledge of stock rights financing to the major shareholders of listed companies by sorting out and analyzing the theoretical literature on the motivation and risk of pledge of stock rights of major shareholders of listed companies at home and abroad.Through the case study of Rao Luhua,the largest shareholder of Kelu Electronics,the cumulative pledge equity of Rao Luhua,the largest shareholder of Kelu Electronics,exceeded 90% of its share holdings at the end of 2017 and 99% in June 2018.Such a large proportion of pledge of stock rights led to financing risk to him.Influenced by the macroeconomic situation in 2018 and the trade war between China and the United States,the share price of Kelu Electronics dropped sharply.Rao Luhua,the major shareholder of listed companies,suffered the risk of liquidation of pledge of stock rights and may lose control of listed companies at any time.Therefore,this paper studies the risks brought to himself and listed companies by the large-scale and high-frequency pledge of stock rights of Rao Luhua,the major shareholder of Kelu Electronics,when the market fluctuates sharply,and analyzes the effectiveness of the market-oriented measures taken to deal with the risks,hoping to arouse the attention of regulatory authorities,investors and major shareholders of listed companies to pledge of stock rights.Through case analysis,comparative analysis and other methods,based on the data of pledge of stock rights of Rao Luhua,the major shareholder of Kelu Electronics,from2014 to 2018,this paper analyses and studies the risks arising from his pledge of stock rights and the measures taken to deal with them.Through the research,it is found that high frequency and large proportion of pledge will lead to the liquidation risk for major shareholders of listed companies,which will lead to the loss of control over listed companies.Rao Luhua,a major shareholder of Kelu Electronics,successfully repaid the pledged loan,relieved the pledge of stock rights and resolved the risk of liquidation of the pledge of stock rights by means of suspended from trading,additional pledge and transfer of part of the company's equity.In the case studied in this paper,Rao Luhua,the major shareholder of listed company,maintained his control over listed company as a major shareholder while introducing strategic investors,and responded to the risk of pledge of stock rights in a timely and effective manner.However,the major shareholders of listed companies still need to control the proportion of pledged shares,fully evaluate the risk of stock market fluctuation and their own financial strength,improve risk prevention awareness,so as to effectively avoid the risk of pledge of stock rights to their own liquidation.The main contributions of this paper are as follows: On the basis of analyzing and introducing the general measures adopted by the major shareholders of listed company when facing the risk of pledge of stock rights liquidation,such as stock suspended from trading and additional pledge,this paper introduces the equity transfer measures adopted by Rao Luhua,the major shareholder of Kelu Electronics,without administrative guidance and regulatory intervention.It provides a new market-oriented solution for the market participants,such as supervisors,shareholders of listed companies and securities firms,in dealing with the risk of equity pledge liquidation.