The Empirical Research On The Relationship Between Private Equity Placements And The Long-term Stock Price Performance

IN2006, China began to implement the split share structure reform, with this reform SFCreleased the listed companies Securities Issuance from May8,2006.With the promulgation andimplementation of this law, A change from the previous tendency of the preference of theallotment of shares in listed companies in China, Using private placement shares to financing. AsChina’s stock market developing so many years, the private placement has become the focus ofcapital market refinancing. Chinese scholars studying of the private placement reach a climaxwith the development of the market, there are private placement discount, transferring of interestsin the private placement process, the short-term wealth effects of private placement, comparingprivate placement issue of principle as well as other financing methods compare. However, fewstudy long-term wealth effects of private placement stock, especially in the context of globalfinancial crisis in2008, how will be China’s directional long-term wealth effect of the additionalshares and is largest shareholder participation a significant positive impact on long-term stockprice? In this paper, select the implementation of the private placement of stock companies fromJune2006to June2007in China A-share market as a sample, Selecting the48months of data,Conducted an empirical study of the private placement of stock and long-term stock price usingregression analysis and univariate analysis methods, The structure of this article can be dividedinto five parts, The first part describes the innovative point of reference literature and articles,The second part analyzes the development of our private placement of stock, The third partdescribes the design of the sample selection and scope of the article and model of the design andcontrol variables and dummy variables, The fourth section explains the empirical results of thestudy, Part V starting from the initial assumption of this paper gives the object of a specificmarket with the corresponding recommendations.