Research On The Formation And Economic Consequences Of Dual Shareholding Structures In Company P

Before 2018,companies listed in China have been implementing the same share and equal rights structure,while the dual-class share structure is not allowed.With the rapid development of China’s economy,more and more Internet companies were established and developed and expanded at an amazing speed,after experiencing the Internet e-commerce giant Alibaba to list in Hong Kong "hit a wall" and then landed on the New York Stock Exchange in the United States,setting the highest IPO record in the US stock,the dual-class share structure has attracted the attention of our country.Finally,in April 2018,HKEX took the lead in making changes to relax restrictions on dual-class share structures.In April 2019,China’s science and technology innovation board also made a decision to allow dual-class share structure listing.The setting of special voting rights stabilizes the controlling body of the founding team,gives it more decision-making power,and makes the enterprise develop better and better under the leadership of the founder.In this context,this paper selects the "dark horse" company P of e-commerce as the research object,explores the economic consequences of the adoption of dual-class share structure by Company P,and attempts to provide experience reference for e-commerce enterprises that intend to adopt dual-class share structure for listing in the future.This paper first introduces the research background,research ideas and research methods,then sorts out the research status of dual-class share structure at home and abroad,introduces the relevant theoretical basis,and finally analyzes the case study of Company P.Taking the establishment of Company P as a starting point,the reasons for the listing of Company P under dual-class share structure are analyzed based on the background situation,and the role path of Company P’s dual-class share structure is constructed,as well as the economic consequences arising under this path.This paper focuses on the economic consequences of adopting dual-class share structure,mainly using literature research method,case study method and event research method,analyzing from three perspectives:corporate governance,financial indicators and non-financial indicators,and then drawing conclusions.In terms of corporate governance,taking agency costs as the starting point,and using the event research method,the first foreign investment of Company P is studied to determine whether the interests of minority shareholders have been infringed.In terms of financial effects,the traditional financial index analysis method and the economic added value analysis method are adopted respectively.Non-financial indicators will be analyzed from market size and innovation capacity.Through the case study of Company P,the following research results and conclusions were obtained:(1)The four major motivations for the formation of the dual-class share structure of Company P were analyzed.(2)The role path of the dual-class share structure of Company P is constructed.The dual-class share structure of P company should go through the role of dual-class share structure-control-company decision-economic consequences.(3)It analyzes the possible economic consequences of the dual-class share structure.First,the dual-class share structure helps improve the efficiency of corporate governance;Secondly,the setting of differentiated voting rights promotes the financial performance of the enterprise and creates more wealth for the company’s shareholders;Finally,after the implementation of the dual-class share system,the company has significantly expanded the market scale and increased innovation investment.