An Empirical Study Of Private Equity Fund Performance Effects On The Company

Private equity funds play an increasingly important role in Chinese capital market. Asa unique business model, one of the most prominent features that distinguishes it fromother types of investment in the financial sector is that private equity funds providevalue-added services to invested enterprises besides only the large numbers of money.Theoretically, private equity funds can be a good incentive tool to the personnel of theinvested enterprises, nurture entrepreneurship, improve the internal governance structure,solve the asymmetric problem of information, expand financing channels for enterprises,accelerate technology innovation and help push industrial upgrading. In fact, from1980s tonowadays, a large number of empirical analysis show that private equity funds play therole of "active investors" when participate in the operation and management of the investedenterprises, and provide the urgently needed resources and services in the developmentprocess of invested enterprises, and have a positive effect on both the performance anddevelopment of invested enterprises.The thesis selects163listed companies which initial public offering date was betweenSeptember30,2009and December24,2010on the Shenzhen Stock Exchange GEM boardas the empirical study sample, chooses IPO day’s indicators data and four consecutiveyears of financial evaluation indicators since2008, respectively discusses the sampleenterprises performance in the short-term and the long-term, according to whether there’sprivate equity funds to support. In the consolidation of earlier review of the literature andthe results of empirical research, the thesis draws the conclusion that private equity fundsare not short-sighted speculators, however, at the same time to help cultivate the investedenterprises, so as to achieve the overall value enhancement, and to play a positive role inthe development of the invested enterprises. Afterwards put forward the problems broughtto the invested enterprises during the development of private equity funds, and then try topropose the recommendations for the future development of the private equity funds.