Research On The Problem Of Interest Transfer In The Private Placement Of Listed Companies

The Secondary Equity Offering for A-share market reaches to an amount of 13878.10 billion yuan in 2015,when a total of 857 companies in the A-share market have completed directed additional and the actual financing is 13723.08 billion yuan accounting for 98.88% of the Secondary Equity Offering.It is clear that the directed additional has become the main way for the Secondary Equity Offering in the quoted company in capital market of China.The directed additional has become the focus in the academia and capital markets,and also been paid much attention by a majority of small and medium investors and institutional investors.However,in the process of directed additional,there are many issues to be discussed.For example,whether the interests between the controlling shareholder and the small and medium shareholders is consistent,Whether the controlling shareholder will carry out the transfer of benefits using its control advantage and information asymmetry,and how the transfer of benefits is conducted by the controlling shareholder,and whether this transfer of benefits will damage the interests of small and medium shareholders.Hence,this study will treat those issues.Here,the directed additional of Bunny(002043)in 2016 is chosen as an example to conduct the study.The transaction occurred in the period after the controlling shareholder has become the actual control of the counterpart.The value-added of the injection assets by the controlling shareholder Ding Hongmin is up to 5008.44%,and the transaction price is paid by the shares completed.In the case of "self-dealing" by the controlling shareholder,the controlling shareholder is likely to carry out the interest transfer in the process of the directed additional.Through the combination of theoretical analysis and case analysis,this paper will examine the operation mode and process of the interest transfer in the directed additional and assets reorganization pf the quoted company in China.This study tries to find the nature of the problem through the appearance of the case and apply the coressponding theory to the practice.This article is organized by five chapters as follows:The first chapter is the introduction.This chapter is divided into three parts,which introduce the background and significance of this research,the ideas and framework as well as the research methods of this paper,respectively.The chapter 2 is the review of the literatures.This chapter focuses on the theory of interest distribution in the directed additional,the transfer interest and the interest transmission.At last,a comment is made to provide a theoretical support for the research of this paper.The chapter 3 is the theoretical analysis of the problem of interest delivery in the directed additional.This chapter is divided into two parts,the first part discusses the system of the directed additional,background and current situation of the quoted company,and also introduces the evolution of policy in directed additiona of quoted companies,then the three financing methods and their scales are compared.The other part involves the analysis of the three important theories,i.e.,the property rights theory,the principal-agent theory and information asymmetry theory.The chapter 4 treats a case study of bunny acquisition win-win network.This chapter mainly analyzes the ways in which the controlling shareholder can carry out the interest transmission in the process of directed additional,including the selection of the timing of the allocation of directed additional,the injection of high premium assessment assets,the implementation of the rich cash dividend dividends and the manipulation of non-fair related transactions.Finally,I obtain a conclusion from this case,that is,the controlling shareholder of the use of its controlling interests and information asymmetry advantages in the private placement through the above four ways to transport their interests,and effectively damage the interests of small shareholders.The chapter 5 is the conclusion of the research,policy recommendations and future prospects.This chapter mainly summarizes the research of this paper,proposes the policy suggestions,analyzes the shortcomings of the research and prospects for the future research.In this paper,the following conclusions are drawn: there is benefit transfer in the directed additional under the control of the controlling shareholder in both the practice and the theory.this directional additional implemented by the Bunny will harm the interests of small shareholders which is not the case as that promised in the announcement,and also becomes the tools which is used vt the controlling shareholder of the quoted companies to transport their own interests.Bunny's controlling shareholder seriously damaged the interests of small and medium shareholders investors by manipulating the issue price of new shares,injecting high premium assessment of assets,and privating placement after the "generous" dividend dividends as well as manipulating the non-public affiliated transactions.Through the study of the case and the problem in this paper.Theoretically,it reveals the specific way and process in which the controlling shareholders carry out the interest transmission from the quoted company through the directional additional.it will expand and deepen the connotation and extension of the principal-agent theory,and also enrich the theoretical explanation of interest transmission in the directional additional.In practice,it can provide policy advice for capital regulators in improving the major asset restructuring system so as to prevente the interest transmission by the controlling shareholders and the protect the interests of small and medium shareholders.