Study On The Risk And Countermeasures Of The Pledge Of The Majority Shareholder’s Equity In OL Company

Since the financial crisis in 2008,China’s economic development has entered the "New Normal",many large companies,especially private listed companies,have begun to seek more and more diversified financing channels and ways.Among them,due to its unique advantages of easy realization and strong liquidity,equity pledge takes a high priority in the financing choice of listed companies.Major shareholders tend to take equity as collateral to obtain financing loans from third-party financial institutions.But with the gradual increase of the proportion of equity pledge in private listed companies,its potential risks are also exposed.At present,in the peak development period of landscape architecture and PPP projects,in order to meet the strong business expansion needs of OL company,the shortage of capital flow and even the phenomenon of fracture are gradually revealed,which directly leads to equity pledge becoming the only choice for OL company to carry out financing.Through a large number of research on domestic and foreign literature and market data,this paper studies the reasons why listed companies choose equity pledge financing,analyzes the infringement of major shareholders on the interests of the company;and through the analysis of literature on the relationship between equity pledge and company value,it is concluded that the larger the proportion of major shareholders’ pledge is,the easier the company value is to reduce.However,there are relatively few studies on the risk and preventive measures of equity pledge at home and abroad,lack of specific case analysis.In view of the above deficiencies,this paper selects representative listed companies of OL company architecture in the landscape industry as examples to study.Firstly,the paper starts with the definition of the relevant concepts of pledge of major shareholders,and then builds the theoretical foundation of the paper by combining the principal-agent theory and the separation of two rights theory.Second big shareholders equity pledge business in China,summarized the present situation and the institutional change,using the financial data and EVA valuation method of OL company before and after the equity pledge is analyzed by the value of the company,proves that OL company of equity pledge exacerbated the financial risk of the company,has certain influence to enterprise’s survival and development,and dynamics of OL company choose equity pledge and paper summarizes risk research.At last,the corresponding countermeasures,improvement methods and prevention suggestions are put forward.This paper hopes to expand the research ideas and perspectives of equity pledge by analyzing the financing methods and risks of equity pledge of OL company,and provide useful experience for other private listed companies to pledge their equity,and also give early warning to major shareholders,hoping that they can take the risk of equity pledge into account,and carry out equity pledge reasonably for the better development of the company.