A Case Study On Equity Pledge Of Controlling Shareholder Of Company A

As an important part of the corporate governance of listed companies,the ownership structure has always been attached great importance to by the major listed companies.The interests of the company are closely related to the interests of the controlling shareholders.Therefore,once the company’s capital chain is blocked and internal and external financing is difficult,the controlling shareholders will find ways to help the company raise funds,especially the low-cost financing method of equity pledge,which is very popular with the shareholders.In recent years,China’s capital market financial supervision has been strengthened,and equity pledge financing has become a trend.Equity pledge is not only popular in A-share market,but also favored by small and medium-sized enterprises.According to the relevant statistical data results,in 2016 and 2017,equity pledge financing has become the most important financing source of the new third board company.Similarly,for the listed companies,due to the national economic depression in recent years,the development prospects of some industries are not good,the operating performance of related companies is deteriorating,the company’s capital chain is tense,and the controlling shareholders tend to finance the company through the way of pledge of equity,so as to alleviate the current capital pressure of the company.Therefore,it is of great significance to study the pledge center of controlling shareholders’ equity.Based on the current financing difficulties faced by listed companies as the background,this paper studies the equity pledge behavior of company a in-depth,through consulting the announcement information issued by the company,reading the relevant literature,looking up the relevant data,using a variety of analysis methods to analyze the equity pledge behavior of A.The first part explains the importance and background of this paper,and extracts part of the information from the previous research experience to form a literature review at home and abroad,and then combs out the main content,research ideas and methods,as well as the framework of this paper.In the second part,this paper reviews the relevant literature of equity pledge,summarizes the pledge behavior from the concept,type,motivation and way of equity pledge,and introduces the theoretical knowledge of equity pledge in detail.In the third part,this paper cites a company as an case,researches the reasons and effects of this company’s equity pledge in detail.First of all,this paper introduces the background and development of company a,analyzes the current equity structure of company a,and analyzes the current operating performance of company a through various financial indicators.Secondly,based on the analysis of a company’s operation,this paper,from the listed companies’ point of view,discusses the motivation of a company’s equity pledge financing,including the macroeconomic environment is sluggish,the development prospect of copper products manufacturing industry is poor,which leads to problems in a company’s capital chain.In addition,company a is forced to carry out transformation and upgrading due to environmental needs.In order to have a better foothold in the financial market,the company urgently needs funds to develop the market and establish a core competitive advantage.However,due to the company’s low profit in the early stage,the profit is often negative,which leads to difficulties in internal and external financing.Combined with the advantages of equity pledge financing,company a chooses the way of equity pledge financing.This part analyzes the motivation of a company’s equity pledge from four aspects: macro environment,capital demand,financing difficulty and its own advantages.Finally,the paper also analyzes the whole process of a company’s equity pledge,including the time,method,purpose of pledge funds,as well as the way of market value management and release of pledge after pledge.Specifically,this paper analyzes a company’s choice of pledgee based on the market environment.In the follow-up operation and management,this paper analyzes the specific direction of the pledged funds and whether the use is reasonable from the cost,operating cost and other aspects.When the pledge is about to expire,this paper mainly analyzes the main sources of repayment funds from the perspective of cash flow.In the fourth part,the paper mainly evaluates the equity pledge of company a,and puts forward suggestions and conclusions for the whole event.The suggestions mainly include restricting the use of funds to avoid excessive investment of shareholders and paying attention to the legal issues of equity pledge to prevent legal risks.The main enlightenment is that effective market value management is conducive to the protection of controlling shareholder status and the rational use of funds to ensure the long-term development of the company.In order to make a summary of the whole article.The difference between this paper and the previous literature is that the previous discussion on the case of equity pledge mainly focuses on the malicious equity pledge of the major shareholders’ embezzlement of funds,that is,the tunneling mechanism of the controlling shareholders to the listed company through equity pledge,while this paper discusses the good faith equity pledge made by the shareholders in order to seek the development of the company,that is,the controlling shareholders pass their own shares to them.In order to realize the rapid development of the listed company,he provides the equity pledge to the listed company free of charge or low interest.