Analysis On The Motivations Of Belle International's Going Private

Going private is a special kind of merger and acquisition,which is used in many mature capital markets as a capital operation method.Scholars have carried out many research analysis about the motivation of the going private of listed companies,and have generated some related theories,which mainly include: agency cost theory,free cash flow theory,wealth transfer theory,the acquisition of prevention theory,share price undervalued theory,avoid regulation theory,etc.Belle international has completed its going private.Its experience has provided a reference for other companies which are preparing or just in the process of going private.Besides,as the leading enterprise of the footwear industry,the analysis of its motivation of the going private also have a sense of enlightenment for other enterprises in the same industry.Based on the current research results and related theories,this paper analyzes the motivations of Belle International's going private from four aspects: performance pressure,loss of shareholder wealth,impairment of intangible assets and strategic transformation.When it comes to the pressure of performance,this paper analyzes the financial status of Belle International with DuPont analysis,it is believed that the continued decline in profitability is part of the reason for Belle International's going private.When studying the loss of shareholder wealth,this paper mainly studies the trend of Belle International's stock price in the ten years from the listing to the final privatization,and believes that the long-term downturn of Belle International's stock price since 2013 is an important cause too.When analyzing the problem of impairment of intangible assets,this paper studies the changes in the intangible assets of Belle International's footwear business and the sports and apparel business in the last three years,it is found that the intangible assets of Belle International's footwear business are severely impaired,which is believed to be one of the factors that lead to its going private.When studying the strategic transformation causes,this paper focuses on Belle international's sales channels adjustment,consumer demand analysis,product upgrades and brand building.After a detailed analysis,it is believed that the demand for strategic transformation is the fundamental cause of Belle International's going private.Through the detailed analysis of the reasons for Belle International's going private,this paper has gained some inspirations.It is believed that China-concept stock companies should rationally view the issue of going private and attach importance to risk control.Footwear enterprises are faced with the problem of transformation and upgrading,they should base on physical retail,take consumers as the center,and actively explore and advance in sales channel adjustment,product upgrading and brand building.At present,the motivation researches for the going private of listed companies are mostly concentrated on the undervaluation of stock prices,short selling of short selling institutions,and switching to other stock markets.Researches on the motivation of strategic transformation are few.Footwear industry is a special industry,many enterprises in the industry not only do the product manufacturing,but also are engaged in the retail entities.There are few studies concentrate on the case study of the footwear industry currently.This paper selects Belle International,a representative company of the footwear industry,as a research object,and analyzes the motivations of its going private from the perspective of strategic transformation,which has certain innovative meanings.