Research On The Conveyance Of The Benefits Of Large Shareholders In Listed Companies’ Private Placement

Private placement has officially become one of the methods of equity refinancing of listed companies in China in 2006.Compared with public offering and rights offering,its issuing policy is looser,issuing procedure is simpler,and issuing cost is lower.Therefore,it quickly occupies the equity refinancing market in China in just over a decade.With the growth of private placement,China has constantly revised the relevant system,but it is still not perfect.At the same time,the shareholding structure of listed companies in China is relatively concentrated.Compared with minority shareholders,major shareholders can directly participate in the major decisions of the company and are in an information advantage.Therefore,it is possible for the major shareholders to use the private placement to carry out the transfer of benefits.This is not only bad for the healthy development of China’s capital market and private placement market,but also bad for the longterm development of listed companies and infringes on the interests of minority shareholders.This article in combing the background and current situation of the development of directional issuance system in China,on the basis of combination of big shareholders and profits in the literature,with Elion Energy Company Limited for example,the major shareholder in five researches in the indemnification of the purchase process,reveals it’s through overestimate the asset value,into the inferior assets,dividends on shares,issue price manipulation process of the indemnification.In view of the above common means of interest transmission,the paper puts forward some policy suggestions,such as improving the corporate governance structure,improving the quality of information disclosure,standardizing the evaluation of the assets awarded by the bidding,and strengthening the supervision and punishment,to protect the interests of small and medium-sized shareholders.On the basis of combing the literature,this paper makes an in-depth study on the transfer of benefits of large shareholders in private placement through case analysis,which has certain practical significance for listed companies,relevant regulatory authorities and small and medium-sized investors.