Analysis On The Motivation And Financial Effect Of ST Fus Hun Steel's Bankruptcy And Reorganization

The Chinese economy has faced descending pressure and corporate has remained high leverage for the past few years.Listed companies which is the dominant force in economic development are confronting problems such as large debt scale and mismanagement.In an increasingly competitive market,many companies have trouble in finance and some have even become delisted companies because of being terminated by stock exchanges.On November 16th,2018,with the issuance of our country's "Implementation Methods for Compulsory Delisting of Listed Companies due to Major Illegal Act",a brand-new delisting system was established,which greatly maintained the healthy and stable operation of our country's securities market.For those listed companies which are temporarily plunged in a debt crisis but actually have operational value and still have development potential in the future,not only can the implementation of bankruptcy reorganization renew the company,but also protect the benefits of all stakeholders to the maximum.Hence the first issue to be considered for these companies is how to efficiently survive through bankruptcy and reorganization.In-depth study of the causes of bankruptcy and reorganization and how to evaluate the financial effects of bankruptcy and reorganization is a field that many scholars are studying,and it has strong practical significance.This article comprehensively uses the case analysis method and the comparative analysis method to conduct in-depth exploration and research on the bankruptcy and reorganization of the case company ST Fugang.First,introduce the entire incident of the case company ST Fusteel,including its profile,the reorganization process and plans;next,analyze the motivations of the corporate reorganization and analyze the financial effects of the corporate reorganization,And then based on the results of the analysis of financial effects,it is concluded that bankruptcy reorganization has brought positive financial effects to the enterprise.Through bankruptcy and reorganization,ST Fusteel not only maintained its listing qualifications and avoided delisting,it also improved the company's ability to continue operating,and also safeguarded the interests of all relevant parties,proving that bankruptcy and reorganization can help the company gain a new lease of life.,Improve performance.Finally,the article summarizes the valuable experience of ST Fugang's bankruptcy and reorganization and put forward optimized suggestions.ST Fusteel's bankruptcy and reorganization case is a typical one of prosperous market-oriented reorganization of listed companies in the iron and steel industry in our country.Not only can the research in this article enrich the related theories about the realization of bankruptcy and reorganization of listed companies in the iron and steel industry,but also provide experience and reference for other similar listed companies.