Research About The Big Shareholders With Discount Price Of The Private Placement On Listed Companies

Since the reform of the equity division, private placement because of theadvantage which hold less threshold of financing, the low costs of distribution,the simple procedure and so on, it gets more and more favor with listedcompanies and institutional investors, and gradually developed into one of theimportant ways of equity refinancing with listed companies in our country,especially in the case of large shareholders purchase the private placement newshares, generally it conducted in the form of discount, and the discount rate wassignificantly higher than the rate which large shareholders havn’t participant in.As a result, some studies suggest that big shareholders infringe minorityshareholders’ interests in the private placement on listed companies in ourcountry. This article firstly reviewed the research background and researchprogress of the listed companies in recent years, found that the research from theperspective of big shareholders was so less, and can hardly find the researchfrom the perspective of big shareholders holding to analysis the privateplacement discount, this article will from the perspective of big shareholdersholding to analysis the relationship between it and private placement discount.As we all know, the big shareholder as a rational economic man, in order tomaximize their own interests, the writer tries to from the perspective of bigshareholders to explore whether it is related to the purchase discount whichbased on previous research related to private placement discount theory,calculated the relationship between them, due to the listed companies usuallyhave the quota restrictions of purchaser during the private placement, mediumand small shareholders usually difficult to purchase the shares of privateplacement, so, the author concluded that big shareholders may violation theinterests of small and medium-sized shareholders during the process of privateplacement when issuing new shares with discount phenomenon. Since2006,relevant laws and regulations issued to consider specific provision in our country,this kind of financing way developed rapidly, more and more listed companies adopt private placement financing, this article selects2006-2013to implementthe purchase of listed companies as samples, come to the following conclusions:(1) Before the implement of private placement with listed company, the first bigshareholder ownership and the purchase discount rate is negative correlation,ownership concentration and the purchase discount rate is negative correlation;(2) The big shareholders to participate in the subscribe new shares will make thepurchase discount rate higher, and the degree of participation, which means themore subscribe new shares ratio, the larger purchase discount rate;(3) the bigshareholders holdings increased, that is, by the number that private placementsubscription of new shares is higher than its original stake, the purchase discountrate will lead to greater;(4) The big shareholder subscribe new shares of privateplacement that selected payment have significant relationship with the purchasediscount.Through the study found that, in this paper, the empirical results support thehypothesis of this article, in addition, the writer from the formula shows that theprinciple of big shareholder transfer wealth by private placement, and test andverify it through the regression analysis, illustrates the big shareholders exist thephenomenon that infringe the interests of small and medium shareholders’ withthe help of private placement for the tool in the process of private placement,through the discount of private placement new shares, and put forward theresearch conclusion at last in this paper, on the basis of theoretical and empirical.The research conclusion of this paper not only helps investors have certainreference significance to correctly understand the private placement, but alsohelp related departments and regulators to formulate principle, which can reducethe phenomenon of big shareholders violate the interest of small and mediumshareholders, ensure the private placement effectively and objectivity, it has animportant practical significance on listed companies about the healthydevelopment of the private placement.