The Effects Of Social Capital On Investments And Tunneling Of Private Holding Companies

Private holding company has become a force that can not be ignored in Chinese capital market.It can control the listed company and realize its expansion strategy through acquisition and reorganization,purchase of state-owned stock,or holding of shares of parent company of listed company.Social capital can reduce the information asymmetry in M&A process to a certain extent and improve the efficiency of M & A.At the same time,social capital exacerbated the actual control of the tunneling behavior.Therefore,it is of great theoretical and practical significance to study the impact of social capital of private holding companies on their M & A and tunneling.This paper deduces the influence mechanism of social capital on M & A and tunneling behavior of private holding companies on the basis of literature summarization.In addition,social capital can also reduce the information asymmetry and the cost of M & A,therefore,it plays a guiding role in the M & A behavior;on the other hand,the social capital can not only make the M & A process more difficult,Social capital to strengthen the excess control and enhance the motive of private holding companies hollowed out;the hidden nature of social capital for private holding companies to provide the opportunity to hollow out.The case study finds that tomorrow's holdings are rich in institutional social capital,commercial social capital and actual controller of kinship capital.The involvement of social capital in mergers and acquisitions is quite high and influenced by social capital in the process of M & A object selection.Reducing their acquisition costs.In addition,the use of social capital to control the shadow company tomorrow,the formation of social capital control chain,reducing its cash flow rights,exacerbated the excess control;and by virtue of social capital to hide the escaping supervision of hollowing out,transfer of assets,social capital is undoubtedly Emptying provides an opportunity.The results of case study verify the theoretical reasoning.Finally,on the basis of the theory and case analysis,the author puts forward three proposals,which are pre-disclosure and auditing,perfecting the internal supervision and honesty culture construction of supervisory departments.It is suggested that for the hidden nature of social capital,the self-As well as the three aspects of preventive measures to put forward the proposed regulatory measures.