Study On The Private Placement Of Xinjiang Tianye Co.,LTD

In recent years,China’s capital market has developed at a geometric speed,and the financing needs of listed companies are getting stronger and stronger.After the reform of non-tradable shares,the China Securities Regulatory Commission(CSRC)issued a normative document in2006,and private placement,as one of the ways for listed companies to implement equity refinancing,officially entered the stage of the capital market.Directional issuance started late in our country,only a short history of more than ten years,but its audit procedures simple,less issuance costs,pricing benchmark choice,release process is convenient wait for a characteristic,at the same time,the controlling shareholders can also subscribe shares to support the development of the listed company by the high quality assets,leading to consider both in number and in the financing amount than rights and public rights,become the main means of financing capital market in China.Private placement is only for a particular investor refinancing,internal attributes is stronger,the average investor is difficult to understand the m&a transaction process and details,so that regulators,investors and scholars begin to pay close attention to secondary factors influence on short-and long-term performance in acquisition and possible transfer of interest risk points,and focus on the controlling shareholders role in it.A large number of existing studies show that private placement is often used as a tool of interest delivery in the capital market,which runs counter to its supposed role in promoting the development of listed companies.However,it does not mean that there are no successful cases of listed companies promoting development through private placement.Therefore,this paper studies the motivation of private placement of listed companies and the role played by controlling shareholders in private placement through case studies,and analyzes the economic consequences,which not only helps similar listed companies to make more favorable financing decisions,but also provides reference for the supervision and system optimization of private placement.Based on the specific case of Xinjiang Tianye’s private placement in 2016 to acquire the assets of controlling shareholders,this paper explores the motivation of the private placement,the interest support behavior of controlling shareholders and local governments,and the economic consequences brought by the private placement.This article first elaborated the selected topic background,research significance,literature review,research methods and framework structure,this paper introduces the directional issuance of relevant concepts and theoretical basis,the second industry in Xinjiang day consider each related party situation,the process of directional issuance and content are introduced,and then analysis the Xinjiang day purchase motivation,and from the purchase price,the injection of assets value compensation commitment,performance analysis in three aspects: the controlling shareholder support for the industry of Xinjiang day behavior,then from the main business,asset structure,financial ability and the analysis of the market value of the four angles of Xinjiang day industry to implement the effect of private placement,Finally,it summarizes the research conclusions and enlightenment of Xinjiang Tianye’s private placement to acquire assets.This paper finds that Xinjiang Tianye stepped out of the delisting crisis through asset restructuring in 2014.In order to respond to the strategic goal of state-owned enterprise reform,realize the transformation and upgrading of the main business and look for new profit growth points,it purchased the high-quality assets held by it through private placement to the controlling shareholders.In the process of the private placement of Xinjiang Tianye,the controlling shareholder Tianye Group supported the development of the listed company by injecting high-quality assets with strong profitability,subscribing to the shares of the listed company at a high price,promising performance compensation,etc.As the actual controller of the company,the State-owned Assets Supervision and Administration Commission(SASAC)of the Eighth Division of the Corps,in order to assist the local government to better fulfill its social responsibilities,conveyed benefits to Xinjiang Tianye Group through a series of ways with the wholly-owned state-owned company as the link,which was a strong "backing" for the smooth conduct of the private placement.Through this private placement,Xinjiang Tianye realized the dual main business operation mode,and its profitability and growth ability improved,but its long-term performance failed to continue,and it began to decline in the second year after the private placement.After the private placement,the proportion of current assets is too low and the liquidity capacity is weakened.The private placement did not bring positive effect in the stock market.