A Study On The Discount Issue Of Private Placement From The Tunneling Perspective

Private placement, established in 2006, is a way to issue shares to less than ten specific objects, playing an essential role in corporate finance. It seems that private placement has become a mainstream in capital markets. However, tunneling in this kind of financing is increasingly exposed, particularly in high portion of discount. Discount results in low efficiency of financing, goes against the interests of the company and other shareholders, threats to the normal development of the capital markets. Thus, it is urgent to develop appropriate policies to regulate discount and tunneling.This thesis consists of two parts, which are the theoretical study and the empirical test. Firstly, review domestic and foreign studies on private placement and transportation issues. Secondly, recall the Principal-agent theory and Asymmetric information theory, analyze the tunneling issue from the perspective "of private placement, theoretically analyze wealth redistribution model and the motivations of major shareholders for different tunneling methods subscribed. Empirical part is the fifth chapter. Using the method of descriptive statistics and multivariate regression analysis to test the hypothesis put forward. Test results proved the proposed hypothesis.There are tunneling issues in private placement; the major shareholders play a dominant role in tunneling; issuing at discount is one of the main means in tunneling; Asymmetric information has a significant impact in discount. Suggestions:the establishment of efficient capital markets and the. improvement of the qualification of professional conduct are essential; gradually transit to the registration system; improve the professional qualification of the personnel.