Research On Hidden MBO Under The Background Of Mixed Ownership Reform

State-owned enterprises play an important role in our national economy.In order to solve the problems of system rigidity,inefficiency and so on,in recent years,state-owned enterprise reform policies have been frequently introduced.State-owned enterprise reforms are also advancing from managing enterprises to managing capital.Holding,then to relative holding,and finally to non-holding.In order to implement the policies of the central government,the Zhuhai government has also vigorously promoted the reform of state-owned enterprises.It proposed to use the diversification of property rights and the introduction of strategic investors as a breakthrough point to promote the mixed reform of municipal enterprises.In the context of the state and the Zhuhai government supporting the reform of state-owned enterprises,Gree Group,which is absolutely controlled by the Zhuhai SASAC,announced on April 10,2019 that it intends to transfer its 15% equity interest in GREE.The transfer was completed on December 2,GREE became an enterprise without controlling shareholders and no actual controllers.GREE is a high-quality enterprise with good profitability and high dividends.Gree Group transfers its 15% equity of GREE to foreigners and causes the transfer of control,which inevitably raises questions.Based on the above background,this article takes the transfer of GREE’s control rights as the starting point,combined with the analysis of the equity control chain and the social capital control chain,and finds that the transfer of GREE’s control rights appears to be a mixed reform of state-owned enterprises,but is actually a hidden MBO.Then,this article focuses on the following research:(1)From the perspective of game theory,explore the causes of GREE’s hidden MBO.(2)In-depth analysis of the unique advantages of the financing model constructed by strategic investors and managers through the limited partnership framework,such as greatly reducing managers’ financing needs and control rights.(3)Analyze the economic consequences of introducing strategic investors to achieve implicit MBO from the perspectives of multiple stakeholders such as strategic investors,the government and Gree Group,GREE and the managers.Finally,this article draws the following conclusions:(1)In this implicit MBO,the social capital used by the management plays a key role.In the process of implementing implicit MBO by GREE managers,strategic investors can not only act as a bridge and play a role in broadening MBO financing channels,but also play a role in restricting managers’ self-interest from its own interests.(2)Although GREE’s managers evaded the supervision of the State-owned Assets Supervision and Administration Commission of the State-owned Assets Supervision and Administration Commission with the indirect help of the Zhuhai government and obtained actual control rights,the hidden MBO this time was not a result of the local government and local state-owned enterprises fighting against state-owned assets.Control was transferred only under the banner of reform,and it did not cause the loss of state assets.(3)GREE’s way of achieving implicit MBO with the help of social capital is worth learning in state-owned enterprises,but it may not be able to be promoted at present,because the successful implementation of this implicit MBO method is very much related to GREE’s own corporate characteristics.The main contributions of this article are:(1)This article emphasizes the research on the role of social capital in MBO.When the equity control chain breaks,social capital control can form a substitute effect on equity capital control.(2)Conducive to enriching the research on the role of domestic strategic investors in hidden MBO.By studying the rights arrangements involved in the cooperation agreement in the case and the economic effects brought about by the realization of the implicit MBO,this paper verifies and derives that the strategic investor plays the role of “bridge” and supervision in the implicit MBO.(3)Provide reference for enterprises to broaden corporate financing channels.The financing practice of GREE’s hidden MBO shows that the introduction of strategic investors can alleviate the difficulty of MBO financing.