The Financial Effect Of Share Repurchase In China And The Analysis Of Its Motive

About 1970s, stock repurchases raise in the western capital market characterized by the USA. After about half a century, stock repurchase has been the usual tool for capital operating, playing a special role in different economic background. Stock repurchase means that the listed corporation buys back its shares by paying to the shareholders, which works as corporation financing. In the end of last century, stock repurchases were introduced to our country with the state-owned enterprises (SOE) on a revolution. Unlike the experience in other countries, stock repurchase worked in a special way in China. However, with the accomplishment of the revolution and the develop of capital market in China, the stock repurchases experience in our country tends to familiar with the one in western while there are still some Chinese feature in it, owning to the economic and legal environment in China, in terms of the financial effect and the motives.Therefore, the motives of share repurchases and the effects of financial help to help managers and regulators to be more correct understanding of the repurchased shares in the mature capital market operation tools commonly used in the capital, more effective help to share repurchase In China's capital markets to function, to enhance corporate value and safeguarding the stability of capital markets.This paper uses case study method, the split share structure reform in China after the completion of repurchase of shares of listed companies and financial effects of motivation to conduct a comprehensive study, and through the days of holding the typical case of audio-depth research and analysis of The financial effect of share buy-back formation, and as a result of inferred motivation for share repurchases, and draw conclusions. And then to promote the results of case studies and found that the practice of share repurchase common problems and put forward policy recommendations.This article is divided into seven sections. The first part is introduction, this research background, research methods, contributions and deficiencies. The second part is literature review, in which summarized the share repurchase Research in foreign countries and domestic research status, and make the appropriate comments. The third part is the theoretical analysis of share repurchases, share repurchases introduces the concept and background, summed up the practice of the financial effect of share repurchases and motivation, discussing the pricing of share repurchase, accounting issues and implementation modalities. The fourth part is the repurchase of shares of listed companies the reality of the situation, reviewed the repurchase of shares at the current practice of the characteristics of the two stages, introduced China's laws and regulations related to share repurchases. Tone for the day holding fifth part of the basic content of share repurchase, the company introduced the basic situation, analyzes the background of the share repurchase, the share buy-back described the content and process. Part VI by comparative analysis of share buy-back before and after the company obtained the market value of the financial effect of the increased financial flexibility to upgrade and two more significant, the results of the share buy-back signal obtained after the transfer, wealth transfer is verified the two motives combined holding of stocks Telling dig out the deep background of motivation is to appease institutional investors, hedge Restricted Shares lifted the share price. Part VII of the policy recommendations for the proposed scope should be expanded share repurchase, respectively, and the amount of financial resources corresponding to its limits, the establishment of treasury stock system and the strengthening of information disclosure to protect the interests of creditors and minority shareholders.In this paper, case study approach, select China Securities Regulatory Commission, "the public listed company to buy back shares of Management (tentative)" announced after the implementation of the first listed company repurchased 000829 shares (Telling Holdings) this club representative listed to conduct analysis of actual cases. For Listed Companies buy back public shares of the financial effects generated in the process and motivation for a detailed analysis and the corresponding policy recommendations, and practical problems with high case time is strong, has some guiding significance.As used in this study is a single case study, and now occurring in China A share market share repurchases are not many practical cases, it is difficult to avoid some of the special nature of this case and the information collected does not affect the conclusions of complete accuracy.