Management Buyout Of The Theory And Practice

Since British economist Mike Bright found the phenomenon of Management Buy-outs (MBO) in 1980, it has been more than twenty years. It has proved that MBO has great advantages in clarifying ownership, reducing agency-costs and encouraging managers. With the development of the global economy, Chinese put emphasis on MBO and it has been applied in many corporations. But the market economy in China has its own characteristic, so MBO in China takes on independent features and meets series of systematic barriers. Under this background, this paper appears.This paper makes on overall exposition about MBO in four parts. In the first part, the author focuses on the definition, characteristics, causation, theoretical foundation etc. This part establishes the stable theoretical foundation for the next parts. In the second part, the author elaborates the significance of MBO in china, operating patterns and their common features. In the third part, the author puts emphasis on the drawbacks in the course of operating MBO and brings forward the directly suggestions. At last, the paper looks into the prospects of MBO. It can be convinced that Management Buy-outs will play its positive role when the systematic environment in China becomes more perfective.