Research On Rescue Path And Effect Of Tatfook Technology Under Equity Pledge

Since "deleveraging" was first proposed at the Central Economic Work Conference in December 2015,financial regulation has become increasingly strict,resulting in a stock market downturn.Due to the limited financing channels,private listed companies began to raise funds through equity pledge with low threshold and cost.In 2018,the proportion and scale of equity pledge in the A-share market reached the highest in history.However,due to large adjustments,the stock prices of most companies fell,and many companies using equity pledge financing faced the crisis of liquidation.In this paper,Tatfook Technology,which successfully weathered the difficulties through the establishment of a rescue fund,is selected as the case study object to analyze the path and effect of its rescue.The main rescue method of the company is to restructure the controlling shareholder,which involves government capital,AMC institution,industrial capital and private equity fund,which is an innovation in rescue form.Specifically,the Xinfu Equity Investment Fund,which is jointly established by Sun Shangchuan,the actual controller of Tatfook Technology and his related parties,and China Cinda Technology,is the new holding company of Tatfook Technology after the bailout,and has optimized the structure of the board of directors to a certain extent.However,the rescue fund still maintained Sun Shangchuan’s position as the real controller through the internal structured arrangement,and at the same time,the rescue fund adopted the structured arrangement of "first and second" for the established participants,so that the benefits and risks of each participant reached a relative balance.First,this paper analyzes the reasons for Tatfook to seek bailout and the motivation of the bailer.Secondly,from three dimensions of easing financing constraints,optimizing corporate governance and restructuring and utilization of industrial resources,the paper analyzes the specific path of Tatfook Technology to alleviate its predicament through the rescue fund.Finally,the short-term and long-term rescue effects of Tatfook Technology are evaluated from three dimensions of short-term market reaction,financial effect and value creation.In this paper,literature analysis method,case study method,comparative analysis method and event study method are mainly used to carry out in-depth analysis of the rescue case of Tatfook Technology Company.Finally,three conclusions are drawn: first,the achievement of the rescue event is bound to satisfy the interests of both rescue parties;Second,the rescue needs multi-dimensional consideration.The key to the success of the rescue is the cooperation and comprehensive promotion between the two sides.Third,the rescue event has significantly improved the company in many aspects in the short term,but the long-term effect will gradually weaken.Therefore,in the end,this paper puts forward suggestions from the three aspects of rescue plan design,multi-dimensional comprehensive rescue and improving the regulatory system,in order to provide some reference value for local governments to design rescue plans to help private enterprises,and to provide reference for the consideration and formulation of relevant rescue policies in the future.