Research On The Optimization Of Enterprise Capital Structure After Leveraging

China is currently in the economic adjustment period,the absolute return of assets show a downward trend,financial institutions continue to increase risk tolerance in order to obtain high returns in the context of the implementation of interest rate market.Too much money to chase less high-yield assets,as asset returns decline,leading to the expected rate of return down,triggering “asset shortage”.Coupled with the relevant policy of leveraged buyout and expansion of private equity bonds again,boost the development of leveraged buyout.Leveraged capital structure is related to corporate governance and future development,so the scientific and rational capital structure mechanism is particularly important.This paper makes a deep analysis of the case of “Shuanghui International” acquisition of “Smithfield” by using the theory of capital structure of leveraged buyout,such as literature research and mathematical statistics,and draws the following conclusions:(1)Enterprise can increase its short-term liabilities when has strong solvency to improve its financial leverage;(2)Equity multiplier and equity ratio have a greater impact on capital structure optimization,while the proportion of current assets and total assets has less impact on capital structure optimization;(3)Asset-liability ratio and enterprise value was inverted U-type relationship,there is an optimal asset-liability ratio which making the highest value of the enterprise.It is suggested that enterprise increases short-term debt so as to improve capital utilization and focuses on adjusting the equity multiplier to enhance profitability.At the same time,plan the ratio of liabilities to assets to develop measures which help to optimize the capital structure.Through the analysis of the case,we get the following inspirations:(1)Increase the level of debt financing and improve corporate financial leverage;(2)Revise financial indicators and upgrade the financial system;(3)Broaden the scale of financing channels and optimize the capital structure.