Research On Corporate Division

Corporation division is one of the tactics of corporation recombination by shrinking their dimensions to the best point of being fit with their managing ability in order to adapt and exist according to inner decision in the surroundings of changing rapidly, while, this method has not been widely used in the China capital market.March 2010, the first case using corporation division to recombine company in china capital market is the Northeast Expressway Company(NEEC).As one of the companies whose stocks are exchanged in ShangHai Stock Exchange, NEEC was formed because of reforming of the administration system of Chinese colored highway industry.For the administrative measures being far more than marketable measures.The administrative measures bring the company into many problems:capital is running at a low level of efficiency; Management is at a state of confusion:trades between affiliate enterprises produce legal risk. Thus, the board made a decision to divide the company into two companiesThe structure of this essay is as follows:Firstly, I briefly introduce the meaning and value of researching on corporation division, then start with analyzing of the structure of assets and capital in NEEC.What's the most important is to analyze the division plan, from legal and the accounting angle.Finally; I will find another way to do the division, according to the proportion of shares.