The Motivation And Performance Analysis Of The Introduction Of Strategic Investors By Midea’s Private Placement

As one of the important ways to use equity financing,private placement has attracted more and more attention in previous years.Introducing strategic investors through private placements can not only raise enough funds to supple the cash flow,but can it bring new resources and platforms.These resources and platforms are very rare for enterprises.And it is not easy to obtain,and the stock held by strategic investors has a 36-month limited sales period,so in this way,the company can obtain sufficient funds and resources and form a stable cooperative relationship with strategic investment companies.At present,the research of introducing strategic investors by private placement is mainly commercial banks,mainly researching the bank’s assistance to IPO after private placement.For other research fields,especially in specific cases,there are few studies on private placement.As one of the representatives of the traditional household appliance industry,Midea has constrained its development due to the industry environment.Therefore,the introduction of strategic investors through strategic private placement has brought new strategic transformation.This paper uses the methods of literature research and case study.Frstly study the literature on the introduction of private investors,and then summarize the main motivations of introducing strategic investors through private placement and the impact on corporate performance.After introducing the case study of the perfect group to introduce Xiaomi Technology,the external motivation and internal motivation were analyzed based on the situation of the home appliance industry and the specific situation of the US group itself,including the integration of resources in the sluggish market environment to seek breakthroughs and strategic layout.Strong alliances between enterprises.Then analyze the impact of Midea Group’s introduction of Xiaomi Technology on financial indicators and income profit,business,corporate governance,and stock price changes.The study found that the introduction of Xiaomi Technology by Midea is a very important step in its strategic layout.It introduces Xiaomi to improve its capital structure,adjust income and improve financial and market performance.Therefore,it provides reference for the traditional industry to introduce strategic investors through private placement.