The Study Of The Problem About Private Equity Investment Decision

Private equity investment is a hot issue in modern financial development,as a highly creative economic activity, its entire process of conceive,negotiation, contracting and withdraw need to go through a number of links,each link contains a large number of decision-making problems; Almost everydecision is closely related with the success or failure of the investment.Therefore, the study of private equity investment decisions-making is veryimportant.With the study penetrate deeply, the study of the problem about theprivate equity investment decision walk towards two different directions.Thefirst one lay particular emphasis on the assessment of item income of privateequity investment, represented with real options theory.The second one layparticular emphasis on the assessment of item risk of private equity investment,represented with analytical hierarchy process. I think these two studies are thetwo sides of coin, in the real private equity investment decision, only considerone of them can’t work out the accurate and scientific decision. So the papersynthesizes these two methods. I think these two representative methods caneffectively evaluate the investment income and risk of private equityinvestment item and they have high theoretical depth, can be used as powerfulmeans of the people who in charge of private equity investment decision.Based on the realization of private equity investment decision problem, thepaper is divided into three parts：The first one is：Through analyze the organization structure of severalwell-known foreign private equity investment institutions, aimed at actual levelof Chinese current corporate governance, proposed a set of private equityinvestment decision-making procedures and mechanisms.The second one is：With real options theory as a point of view, assess theitem investment income of private equity investment decisions and use this method to assess "CDH—takyo biological" this private equity investment case.The third one is：With analytical hierarchy process as the point of view,assess the item investment risk of private equity investment decisions and usethis method to assess "SCI—Netac" this private equity investment case.The paper use of the above two kinds of methods, assess the actual levelof private equity investment decisions of china-capital and foreign-capital.The research work of this paper will help to improve the evaluation toolsand evaluation methods of china’s current equity investment decision, so thatprivate equity investment decision-makers can accurately assess the valueand risks of investment projects and improve the accuracy of private equityinvestment decision-making, promoting the development of Chinese privateequity investment from microscopic aspect.