A Research On The Institutional Environment Of Chinese Companies' Management Buy-out Practices

The fourth conference of the fifteenth session of the Chinese Communist Party put forward that the state-owned assets should withdraw all-sided from the competitive industries, which put the reform of the state-owned enterprises into a higher stage. At the same time, with the spread of the theories of Principal-Agent and Property Rights, people begin to realize that the separation of ownership and management rights is not the only way of the reform, and the combination of ownership and management rights may be a way to raise the firms' performance. Compared with the outer competitors, the management has the advantages on information, which makes the Management Buy-out (MBO) become an important way in the withdrawal of the state-owned assets. Recent years, a lot of deeds appeared in MBO such as transferring the state-owned assets and lower the firms' assets. The managements hope to buy the enterprises at low price, which has led to the serious loss of the state-owned assets and the financial department had to suspend theMBO application. Is there any defect in MBO or in our country's institutional environment? Which institutions prevent the application of MBO in the right way? How to perfect the institutional environment? The thesis discusses these problems in six parts.The first is the introduction part, which points the issue's background, the theoretical basis, the relevant papers, and the framework of this thesis. The second part is the comparative analysis of Chinese and American's MBO, which compares the differences of two countries' MBO in background, institutional environment and characters. The third part is the status of Chinese listed companies' MBO, which analyzes the prize of the state-owned assets, the control degree of the management and the performance of the firms. The fourth part is a research on the key stages of MBO including the prize system, the financial source and the control of the management. The fifth part is the analysis of cases, in which there are two typical cases waiting to be vivisected. The sixth part is the conclusion, which sums up the fruit of the research and puts forward the political suggests.