Case Analysis Of Market-oriented Debt To Equity Swap Of Yunxi Holding

In the way of debt disposal,debt to equity is a very important way.From the end of last century,China began to widely use the method of debt to equity swap.In 2016,China officially launched the market-oriented debt to equity swap,which gave support to this disposal method at the policy level.However,the role of investors as shareholders can not be fully played.The soft restriction of equity after the conversion will lead to moral hazard.Under the influence of these factors,the process of market-oriented debt to equity conversion is not very smooth.In October 2016,Yunxi holding and China Construction Bank signed a market-oriented debt to equity swap agreement,which is one such agreement in China.The total amount of this debt to equity swap is 10 billion yuan.Both parties jointly set up a special purpose vehicle through which they will give funds to Yunxi holdings and related parties in different forms in two phases.In this paper,the first case of debt to equity swap in our country is taken as the analysis and research object,and the trade-off theory is taken as the theoretical basis.This paper introduces the transaction elements,transaction process and implementation effect of Yunxi holding case,deeply analyzes the debt to equity model of industrial investment fund used in this case,summarizes the advantages and risks of market-oriented debt to equity under this model,so as to give some suggestions for the development and implementation of market-oriented debt to equity.In the new round of debt to equity innovation,the debt to equity model of industrial investment fund successfully breaks away from the new round of debt to equity dilemma and promotes the implementation of the project through market-oriented means.At the same time,there are some compliance risks and credit risks in the transaction mode.Finally,it is suggested that the relevant laws and regulations of our country should properly amend and perfect some specific problems of the model;market participants can use big data means to evaluate the credit situation of debt to equity enterprises in real time;for the behavior of escaping and abandoning debt,we should increase the punishment.