Some Researches On Management Buy-out

Merger and Acquisition (M&A) is the core method of capital management and an important mode of enterprise's development. Global enterprise M&A has taken place five tides. M&A in our country is on the second tide. This tide from 1990s to now has become a hot question currently and an important component in economy life. Because our capital market and security market is still young and the market mechanism is unsound, system environment financial environment law environment and realities of our country cause many obstacles to M&A. So the M&A mode and method is very limited.Management Buy-outs (MBO) is a fledged type in western countries. But it has appeared recently in our country. Its obvious feature, which can explicit the relations of Property Right and effectively elevate employee's enthusiasm, is precisely adequate for our current situation. So MBO gradually becomes a new M&A type in our country. However, because of some reasons, there are also some problems in MBO of our enterprise. As the reduction and withdrawal of state-owned stock shares spreads out, MBO is widely paid close attention to. This paper explains MBO theoretically, probes the significance of MBO, finds the main problems existed in MBO in our country by analyzing some cases, studies the evaluation about the company and the financing of MBO, expounds my own perspective and solutions.This paper is divided into six chapters: Chapter one is the introduction, which states the background, orientation, domestic and international state of development, objectives. Chapter two summarizes MBO and theoretically probes the significance of MBO to our country. Chapter three is the research on the MBO cases in our country. According to analyzing these cases, we can prove the significance of MBO and find the main problems existed in MBO in our country. Chapter four is about the evaluation about the company. In our country, the evaluation about the MBO enterprise is so low that the state-own assets are lost a lot. This phenomenon is caused by many reasons. This part expounds constructive suggestions and studies a way, which integrates several methods such as Discounted Cash Flow(DCF) Economic Value Added (EVA) multiplier method of market surplus rate replacement cost approach, to evaluate the company and measure founder's contribution to enterprises. Chapter five is about the financing of MBO. According to comparing the domestic and international financing modes of MBO, there are many obstacles in the financing of MBO. Under our country condition, this paper searches for the financing modes of MBO to break through obstacles. In financing frominternal reserves, enterprises can pursuance the system of the employee stock ownership and state-owned stock shares returned to debt. In financing from external reserves, enterprises can found "MBO private investment company" in cooperation with investors and finance of MBO by Trust. In the last part, summarizes the major points and also points out the issues yet: to be studied.