The Impact Of Private Equity On Business Performance In Small And Medium-sizde Plate Board

SMEs played an important role in the national economy. More and more countries are beginning to recognize it, for the theoretical study of small and medium enterprises are also committed for many years and have achieved significant results and the same conclusions. However, the development of SMEs in China has been subject to the constraints of the capital, management level and SMEs has been in embarrassing situation. Private equity investment is an equity investment of emerging, unlisted companies with high growth potential. China should vigorously develop the private equity and finance through private equity to solve the financing problems of SMEs and promote the development of small and medium-sized enterprises healthy development and ultimately drive the national economy towards sustained and healthy and orderly development track.Private equity funds invested enterprises, but also for enterprises to provide management, technical and other services, to participate in the major decision making. Under these circumstances, the risk is enormous, so the return of private equity investment is required to be also enormous. The main form of private equity investment gains is to exit the investment after the IPO, so there are differences between private equity-backed companies and non-private equity companies on the timing of IPO.Private equity play a comprehensive role on invested companies. Most of studies have shown that private equity plays a positive impact on business performance of SMEs.Western multinational scholars have confirmed this conclusion:studies have shown that private equity investment to ease the conflict of the various stakeholders, and effectively reduce the agency costs, plays a positive role in the results of operations of the target company.Small plates is not only an important part of China’s financial market and also is the financing, platform of China’s small and medium enterprises. Due to the participation of the private equity investment, the small plates also become the most important exit platform of private equity investment. Therefore, this study is about the companies which were IPO on small board from2007to2009and all companies listed in the past two years is divided into private equity participation and non-private equity investment, research the operating results before and after listing of these two types of companies to test the difference between two types of listed companies and if the private equity companies operating results are better than non-private equity ones. Finally analyse the results and make the policy recommendations of the development of private equity.