Research On The Issuing Motivation And Influence Of Exchangeable Bonds

The exchangeable bond was born under the background of "activating the stock" in2013.As a new financing tool with both debt and equity nature,with the development of the market,the purpose of the issuance of exchangeable bonds has become increasingly diversified,except for the traditional In addition to shareholding reduction and financing,capital arbitrage,mergers and acquisitions and share swaps have become the main demands of some issuers,and various functions have their advantages.Compared with other daily financing methods such as bank loans,equity pledges,trust companies,etc.,the average cost of financing through debt securities is lower than the above methods;compared with reducing shares through block transactions,through debt securities Reduce the impact on the secondary market,and at the same time,the transaction time and transaction amount are relatively flexible;you can also make profits for the enterprise through the "EB+CB" method,so the payable debt is a new and practical financial tool.After several years of development,the number and scale of exchangeable bond issuance have also achieved rapid growth,but the number of publicly issued bonds is not many.The case selected in this article 17 Tongkun EB is one of the few publicly offered bonds.In addition,the design of its terms is relatively comprehensive.Except for the basic terms and exchange clauses,all trigger clauses are involved.Moreover,he basically achieved a successful share exchange,with a share exchange rate of 97%,so it is worthy of further study.This article wants to analyze the real motives of Tongkun Group’s issuance of the convertible bonds and the impact on various stakeholders,and finally put forward some substantive opinions from multiple perspectives based on the above analysis.This article adopts a case study method and selects Tongkun Group as the case company.First,it introduces the issuer and target company,and then analyzes the bond issuance background and issuance situation from the industry situation,the company’s operating results and the debt structure to understand this case background.Later,it analyzes its issuance motivation from three perspectives: financing motivation,holding reduction motivation and capital arbitrage motivation.(1)Financing motivation,mainly from three aspects of the company’s future development,terms design,and broadening financing channels to reduce financing costs;(2)Motivation for holdings reduction,mainly from terms design,target company status and debt reduction Analyze the motivations of its shareholding reduction from three perspectives;(3)The motivations of capital arbitrage,starting from the "private equity + fixed increase" model to analyze the motivations of capital arbitrage.Based on the above multi-angle analysis,it is fully proved that the motives of this 17 Tongkun EB issuance include financing,holdings reduction and capital arbitrage.Later,we analyzed the impact from the perspective of the issuer,the target company,the bond investor’s perspective,and the target company’s small and medium-sized investors.(1)From the perspective of the impact on the issuer,the financial status of Tongkun Holdings has deteriorated,and its holding position has not changed after the issuance of payable bonds;and the company has achieved the purpose of this issue of payable bonds-financing Reduction and arbitrage.(2)From the perspective of the impact on the target company,the major shareholder’s shareholding ratio has declined after the issuance of payable bonds according to the entrusted-agent theory,which has improved the company’s equity structure to a certain extent,which is more conducive to the long-term development of the company;at the same time,this issuance Exchangeable bonds will have a negative but insignificant impact on the underlying stock price in the short term,and will have a positive but insignificant impact on the underlying stock price in the short term during the conversion period.(3)From the perspective of the impact on holders of payable debt,it can be divided into two types of analysis: hold-to-maturity redemption and share swap.The yield of holding-tomaturity redemption is approximately 1.855%,while the exchange The rate of return is probably more than 50%.(4)From the perspective of the impact on small and mediumsized investors,the stock price trend chart found that there was a period of relatively large fluctuations,especially before and after the conversion period and after the second conversion price adjustment.The impact on investors’ income is also relatively large.Finally,based on the above analysis,this article puts forward the following recommendations: for issuers,it is recommended to make full use of the payable bonds,rationally design various terms,reasonably choose the timing of bond issuance,reasonably carry out negative earnings management and correctly respond to various risks;for regulators,It is recommended to appropriately relax the issuance requirements and improve the rules and regulations;for investors,it is recommended to understand their issuance motives from multiple aspects before investing.The research in this article can provide practical and theoretical experience for companies planning to issue exchangeable bonds in the future,reduce investor losses,and provide a reference for regulators to regulate my country’s exchangeable bond market behavior.