The Influence Of Major Shareholders’Reduction On Firm Value Based On Ownership Structure

As the reform of non-tradable shares basically completed, China’s stock market has entered intothe full circulation time. The original non-tradable shares have obtained circulation, with the risingnumber of unlocked shares, the major shareholders decrease stock behaviors appeared frequently.Large shareholders on the secondary market to sell their holdings of stocks, what kind of impact willthis decrease stock behaviors have on the company. This paper mainly through literature review andtheoretical explanation, under the different nature of the equity and ownership concentrationsummarizing the major shareholders’ reducing holding-shares behaviors on the impact of the value ofthe company. And from the two aspects of ownership structure, the paper empirical researches theinfluence of the major shareholders’ reduction proportion upon the company value. The results provethat the state-owned holding companies’ major shareholders’ decreasing behaviors will promote thevalue of the company; non-state-owned holding companies’ decreasing behaviors are not conducive toenhance the value of the companies, but the effect is not significant; in the company of the highownership concentration and equity balance degree low, major shareholders’ wishes of decreasingstock will be higher; and in the last concluded that the nonlinear relationship exists between majorshareholders’ decreasing ratio of different ownership concentration and the company value, inverted"U" shaped relationship, it can be seen that major shareholders decreasing ratio within a reasonablerange will be beneficial to the improvement of the value of the company. This provide a little help tostudy how the major shareholders of listed companies in China should take the reduction strategy toavoid taking adverse effects on listed companies due to the reduction of major shareholders, andenhance the corporate value in future.