Empirical Research For The Influence Of The Classification Of Objects Of Private Equity Placements Of Chinese Listed Companies On Corporate Performance

This paper is committed to research the influence of the object types of private equity placements of listed companies on the their long-term operating performance. Numerous domestic studies focused on the non-standard status of private placements in present Chinese capital market, and the effect of short-term stock price of issue enterprises. Documents on object type of placements have still taken the criteria of controlling shareholder or not for the classification. This paper attempts to bridge the gap in the existing literatures, to classify object types in placements aiming to find its'influence on performance, then implant shareholders'activism theory to see which role the institutional investors play in private placements.In this paper, specification and empirical research methods combined for analysis. For the specification, we classified object types with the methods that the objects in placements affected companies'governance as the basic criteria. Then on the basis of the assumptions in exsiting documents, we presented our own theoretical assumptions to promote empirical research. For the empirical study, we primarily used factor analysis to construct corporate performance scoring system with the financial indicators from annual financial reports of those corporations, and then put institutional shareholding variable in the model as a moderator to quantify its'effects on the performance of the issuing companies.The empirical analysis concludes that: first, the placements to the controlling shareholders has a negative impact on firm performance; second, related party transactions between the enterprise and their shareholders can improve the value of the company; Finally, the placements to the outside investors has a positive impact on corporate performance, but the institutional investors because of their negative attitude to corporate governance cause a slight negative impact on firm performance.