Analysis Of Effects Of Private Placement Of Jinjiang Stock

Private placement is a kind of common method of refinancing for listed companies.It is often used in the areas of mergers and acquisitions,project financing,debt restructuring and supplementary capital,especially entering the "full circulation" era.Compared with other financing methods,the private placement has more advantages in speed and cost.Private placement has many different functions.Firstly,enterprises can take private placement to improve financial situation and optimize capital structure.Secondly,private placement can be used to finance for new projects,which will help to accelerate company’s expansion.Thirdly,private placement also can used to change the actual controller.In recent years,the case of private placement of listed companies has been growing rapidly.The mixed ownership reform is an important measure to promote the marketization of state owned enterprises in the process of gradual improvement and development of socialist market economy.Central working conference proposed to deepen the mixed ownership reform and improve the policy environment,legal environment and public opinion environment.State owned enterprises not only can optimize ownership structure and enhance governance capacity but also can establish incentive mechanism and improve operational efficiency through the mixed ownership.Locally-administered state-owned enterprises are important part of mixed ownership reform.Many provincial governments have issued specific guidance to accelerate the reform significantly.Based on the theory of private placement and mixed ownership reform,this paper analysis the case that Jinjiang Stock introduces strategy investor with private placement.There are some reasons for selecting the case.Firstly,Jinjiang stock is one of the earliest locally-administered state-owned enterprise which explore the mixed ownership reform.Secondly,the scale of Jinjiang Stock is larger than the others in the same period.Thirdly,the strategic investors participate in corporate governance deeply.Event study method,EVA analysis method and performance analysis method are used in this paper.First of all,this paper introduces the participants and the process of the private placement and analysis the causes of the private placement.Secondly,the regression analysis is used to study the response of the secondary market in 10 days before and after the announcement date.Thirdly,by analyzing the financial statements of the enterprises,the paper analyzes the capital structure and profitability of Jinjiang stock after the private placement.the EVA analysis method is used to study the short-term performance.By the analysis of this case,this paper can get the experience and results of the mixed ownership reform of the state-owned enterprises with private placement.This paper also can provide the experience and enlightenment for the mixed ownership reform in the future.