Analysis On The Motivation And Economic Consequences Of Introducing State-owned Capital Into Private Enterprises

The 18th CPC National Congress put forward the reform of "actively developing mixed ownership economy".In recent years,state-owned enterprises have actively promoted the reform of mixed ownership,which has been quite effective.With the further development of the mixed reform of the introduction of social capital into state-owned enterprises,the phenomenon of private enterprises introducing state-owned capital to carry out reform is becoming more and more common.In the environmental protection industry,there have been many reform cases of private enterprises introducing state-owned capital in recent years,such as the private enterprise Dongjiang Environmental Protection introduced state-owned shareholder Guangsheng Company,and the actual controller of Guangsheng Company is the Guangdong Provincial State-owned assets Supervision and Administration Commission;another example is the private enterprise Oriental Garden introduces state-owned strategic investors Yingrun Huimin and Chaoxin Huimin,while Yingrun Huimin and Chaoxin Huimin are subordinate to Beijing Chaoyang state-owned assets.From the perspective of private enterprises,this paper mainly studies the economic consequences of private enterprises introducing state-owned capital.The development of the environmental protection industry is closely related to the national policy,which has promoted the development of a number of private enterprises.The amount of investment in environmental protection enterprises is large,and the development of enterprises is inseparable from the support of capital and technology.In 2015,the state launched the PPP financing model,which relieved the financial pressure of the government and brought new policy dividends to the environmental protection industry.Many environmental protection private enterprises have participated in the construction of environmental protection operation projects,and the overall business performance of the industry has been growing.Some private enterprises develop more aggressively,undertake more PPP projects,and have a great demand for funds during the project construction period.However,under the influence of the strong regulation of the financial market in 2018,the "deleveraging" policy makes it more difficult for environmental protection companies to raise financing costs.Some private enterprises’ cash flow deteriorated rapidly,business performance declined,faced with the risk of equity pledge,chose to transfer control to join the state-owned capital army.Therefore,this paper chooses Oriental Garden as the object of case study,discusses the impact of the introduction of state-owned capital into private enterprises on the economic consequences of private enterprises,and tries to put forward relevant suggestions for the follow-up development of the introduction of state-owned capital into private enterprises.This paper analyzes the motivation and economic consequences of the introduction of state-owned capital into oriental gardens from the perspectives of political relevance theory,priority financing theory and enterprise strategic coordination theory.Combined with the reform of mixed ownership and the related concepts of strategic investors,through the analysis of the specific cases of oriental gardens,we come to the following conclusions: first,in terms of market performance.After the state-owned assets control the Oriental Garden,the market response is positive in the short term;second,in terms of financial performance.After the investment of state-owned assets,the financial indicators of Oriental Garden have been improved to varying degrees in the short term,but the long-term financial performance needs more time to test;third,in terms of non-financial performance,after the state-owned assets joined,the company’s ownership structure has changed.the corporate governance structure has also been improved,while the business has also been adjusted.Although the investment of state-owned assets has helped Oriental Gardens through the crisis,and the company’s management continues to improve,the long-term development of private enterprises still depends on themselves,and can not blindly rely on the government.Enterprises should carefully consider whether it is suitable for nationalization in the light of their own development status and future expectations,rather than blindly pin their hopes on nationalization to solve the problem.Even if state-owned assets help private enterprises improve their plight,private enterprises should consider their own long-term development,adjust their business structure and improve their technology and innovation capabilities,so that they can develop healthily in the long run.