Study On The Influence Of Major Shareholders’ Clearance Reduction On Enterprise Value

Share splitting reform is an important link in the development of China’s capital market and an inevitable choice for the development of our stock market to a certain stage.However,with the release of restricted stocks,the phenomenon of major shareholders’ disorderly reduction in holdings and illegal reduction in holdings is becoming more and more obvious.To maintain the order of the capital market,the China Securities Regulatory Commission has introduced relevant laws and regulations continuously on large shareholders reducing their stocks.But the relevant policies is mainly to supplement and regulate the new situation and new problems,which have certain loopholes and hysteresis.Therefore,the frequent reduction in holdings of major shareholders in the current market is still not prohibited entirely.For example,the frequent clearance reduction of large shareholders in recent years has not only seriously disturbed the order of the capital market,but also affected the enterprise value of listed companies,which has become an important research focus in academia.Therefore,the analysis of large shareholders clearance reduction on the impact of corporate value has research significance.At present,most of the research on large shareholders’ reduction in holdings focuses on the impact on the interests of minor shareholders,and most of them are in the form of empirical research,and few studies use case to analyze the impact of large shareholders’ reduction on corporate value.Therefore,this paper takes the case as the object to analyze the impact of large shareholders’ reduction on corporate value to enrich the relevant literature to a certain extent.In many cases,the reduction drama of the 2345 Co.Ltd.has been attracting much attention.Not only did the beneficial controlling owner withdrew from the company,but it also obtained cash reached 8.5 billion yuan by selling stocks during the past eight years,the title of “Reduced holdings king” is “Worthy of the name”.Therefore,this paper basing on the research object,firstly combs the related literature about the large shareholders’ reduction in holdings and the enterprise value,and secondly introduces the mechanism of the large shareholders’ reduction in holdings affecting the enterprise value in detail,then from two angles to explore the impact of the reduction in holdings on enterprise value: First,it is based on the signal transmission perspective,which mainly adopts the event study method to analyze the change of the case company’s stock price before and after the large shareholders’ clearance reduction;The second is based on the perspective of ownership structure,mainly under the guidance of EVA momentum method to analyze the operating efficiency and profit efficiency before and after the stock reduction,so as to study the change of the company’s value and the specific path of the change.At the same time,using the Tobin Q value to further confirm the impact of large shareholders’ clearance reduction on corporate value.Through the research,it is concluded that whether based on the signal transmission perspective or the ownership structure perspective,major shareholders’ clearance reduction will eventually lead to the decline of enterprise value,which will damage enterprise value in different degrees.From the perspective of signal transmission,when major shareholders reduce their holdings on a large scale,small and medium-sized investors are likely to follow major shareholders to sell corporate stocks based on panic psychology.During this period,the wealth effect of the corporate market usually shows poor performance,the company’s stock price continues to decline,the market value evaporates,and the enterprise value declines.From the perspective of ownership structure,the change of ownership structure after clearance reduction makes the corporate governance situation such as equity balance and business strategy decision-making change,resulting in the reduction of the company’s operating efficiency and profit efficiency,and the calculated EVA momentum value also decreases,ultimately dragging down the value of the enterprise.