On The Development And Prospect Of MBO In China

In this paper, we introduce the concept of MBO and the forms .The development of MBO is built on the rock of traditional theory of acquisition .We summarize ten theories about MBO.MBO originate from the west countries. We discuss in detail about the motion, the style, the procedure and the trade of MBO in the West. And point out that the Management buyout accelerates the development of their capital market. However, as lever- acquisition, it faces venture.Changing from traditional planned economy to the market economic, we face some difficult such as ownership and agency-costs. As the MBO being used in China, it has showed great advantages in clarifying ownership, reducing agency-costs and encouraging managers. However, it expose the disadvantages such as purchase price, information transparency.According to analysis, we find out some characters of stock companies that have finished MBO or are planning MBO .we also find out the mutual feather of the companies that carry out MBO successfully. There are many differences between the West and China. We have a lot to learn.With the development of economic reform, it is urgent that well-disciplined manipulate be formulated. The main points are as follows:Firstly, we should take advantage of the advanced fixed-price mode of MBO in the West. Secondly, we should built up unified property trading market in the country to insure the justness price of MBO. Thirdly, we should strengthen legislate to perfect the rule of stock company and consummate the rule of information transparency. Fourthly, we should innovate to open up financing channel for MBO. Finally, we should control every part of MBO intensively. We insure that the interspace for MBO is wide. It points out that MBO is an efficient way of property reunion and one of the ways to reduce the gross of national share.