A Study On LBO In China

With the development of Chinese capital market, the number of the mergers and acquisitions among Chinese corporations arises progressively. To develop quickly, enterprises group often use the means of operation of capital. As a new form of corporation mergers, Leveraged Buyout (LBO) has been paid more and more attentions in academic and corporation field of China.There are still many barriers facing LBO in China. There are some difficulties in the operation of LBO. Then, what is the fundamental of LBO? What is role of LBO on restructure industry and reform of corporation system? These questions are worth researching. As a result, it is meaningful to study operation mode of LBO in China. Such the realistic conditions and the research also can provide some conduction and advises on adjusting resources and improving the efficiency of M&G.This paper discusses the strategy mode of American LBO by analyzing the occurring background. Here it deeply studies the principle and the whole process of LBO. Relating to the situation of our country, this paper analyzes the legal environment, financing channels and exit approach of LBO. It also research on LBO pricing mechanism, and finally gives some policy advises on how to promote LBO in our country.The innovations of this paper are mainly on: Firstly, based on analysis of pricing methods, it gives some opinions on improvement of LBO pricing mechanism. Secondly, this paper collects domestic cases to analyze in the course of research, which makes more straightforward and detailed analysis of the problem of LBO in current capital market environment, and the remedies. Thirdly, relating to the situation of our country, it gives some policy advises on establishing a reasonable LBO mechanism.I think LBO, which is very popular in western country is sure to play a great role in Chinese economy development. And I also hope that this paper will enlighten the research of LBO in academic and corporation field of China.