Research On Listed Companies Were Bailed Out Path In Financial Trouble

With the increasingly development of market-oriented economy and capitalmarket,competition among enterprises become more and more intense, these lead to anincreasing number of listed companies in financial trouble due to the operatingenvironment or mismanagement, this is not only caused serious losses to the enterprisestakeholders,but also caused some negative impact to the socio-economicdevelopment.What turnaround strategy the enterprises could use to get rid of the financialdistress, how the distressed enterprises to choose, and which path is the best, all thesequestions have been the most serious problems for the ST management．Firstly, this paper introduces the research background of the financial distress, thenelaborated Cash flow theory and Recombination efficiency theory.After that, to betterunderstand the characteristics of distressed companies, this paper introduced distributioncharacteristics of financial distress through statistical research, then introduced the causesof financial distress from inside to outside. The ways for out of financial distress aredivided into asset acquisitions, asset replacement, asset stripping, merger, debtrestructuring, share transfer and share repurchases. This article was not only carried out adetailed study on the seven strategies, but also summarized their characters andapplicability;asset stripping, share transfer and asset acquisitions are the three most used.Last, case study on “China Eastern Airlines and Shanghai Airlines’ mergence”.The innovation and characteristics of this paper is that it introduces the ways out offinancial distress in detail and combined with strategic management theories, restructuringefficiency theory and so on, besides that, summarized their characters and applicability,thesis conclusion has reference value for financial distressed companies.