Legal Perfection Of MBO Financing In China's Listed Companies

Management buyouts(MBO) is the target company's manager or managers by the use of loans financing the purchase of the company's shares,thus changing the company's ownership structure,control of the structure and the capital structure,and achieve the purpose of the reorganization of the Company,and expected to receive the proceeds of an acquisition.In this paper,referring to foreign financing experience,in light of China's national conditions,and on the management of listed companies in China currently used by the acquisition financing in the form of financing and in the course of the legal obstacles and emerging legal issues,and proposed the establishment of an effective MBO financing channel's recommendations.Chapter 1:Overview of MBO.MBO financing options including interest financing,debt financing and financing of three prospective interests.Interest financing refers to raise funds through the issuance of shares,rights and interests of the prospective financing of this mode of financing between stocks and bonds between,such as convertible bonds.Financing structure refers to the various means of financing the proportion of.The financing structure of the higher proportion of debt financing,the role of financial leverage greater means that the financing of higher risk. Higher proportion of the rights and interests of the financing will reduce the financial risk financing,but financing costs will be higher,it could also lead to control of the diluted.Therefore,in the financing of management buyouts should consider financing costs,financing risks,such factors as the condition,select the best financing structure.Chapter 2:foreign MBO financing practice.Creditors led by the United States to the mode of financing,management buyouts,mainly through debt financing,mergers and acquisitions and creditors in restructuring after playing a key role.UK equity investors led by the mode of financing,equity financing the proportion of high.Russia, Eastern Europe and other countries for the bank-financing model.Japan for the Government to promote the financing model.Through management buyouts abroad can be seen well-developed financial markets and improve the financial legal system, improve the corporate governance structure,as well as the active participation of intermediary agencies for MBO financing is essential.Chapter 3:China's listed companies MBO financing and Empirical Analysis of the legal issues.Guangdong,the United States,Heng Yuan Xiang and Quanxing Group is a typical Chinese listed companies MBO cases,we can see from the cases used by the original pledge equity loans,hire purchase,ESOP financing methods such as was prohibited by current law,and within the relatively limited funding,the introduction of strategic investors and financed by the Trust are used in the practice of a small,not legal protection.Therefore,the management of China's listed companies to raise funds to buy enough.On the commercial bank loans and insurance payments as well as the use of the conditions on the issuance of bonds listed companies make MBO financing emerged in the course of a variety of issues.Chapterâ…£:China's listed companies in the financing of management buyouts legal perfect.Recommendations improve the relevant legal system,including the deregulation of commercial bank lending purposes,the company reduced restrictions on the issuance of bonds to speed up the legislative and private fund promoting timely pension funds and insurance involvement,and proposed to establish and perfect the management mechanism for the withdrawal of acquisition financing and priorities Unit financing mechanisms,and improve the financing of management buyouts information disclosure system.