Exploration Of The Company's Value Maximization Of Capital Structure

Western modern companies originated in the 17th century colonies established in the Netherlands and the United Kingdom.In 1807,the French "Commercial Code" for the first time legally made a systematic and complete regulation of the company.After the end of the Second World War,the world capitalist economy achieved considerable development.So far,the company has become a universal corporate form in the Western capitalist world.From the perspective of the company's shareholders,how to max,imize the benefits has become their biggest concern.Maximizing the value of the company is the best way to maximize the interests of the company's shareholders.After China's reform and opening up,the socialist market economy based on public ownership developed rapidly.The capital structure theory based on the Western capitalist system often appears to be incompatible with reality in the practical application of the Chinese economy.In the course of research,I found that the owner's equity in the composition of Chinese listed companies has a very close relationship with the company's value.This paper attempts to find an entry point from this aspect,trying to find out what kind of owner's equity and interest-bearing debt stock can be rea ized.On this basis,the company's owner's equity value multiplier model is established,and key factors such as debt stock are included in the same function.Through mathematical methods,the stock of interest payment liabilities that can maximize the company's value is found.The paper proves that the company's management should keep at least the company's interest-bearing debt stock at more than half of the total assets.Moreover,this paper also considers the:financial distress cost and other factors that have long been emphasized by theoretical research,so as to further optimize the mathematical conclusions obtained by the model.In the course of-the research,the paper also found that the company's shareholders continue to promote the management's output of high leverage signals to help the company's value.So this paper builds a function on the signal and incorporates it into the calculation of the company's value.The mathematical derivation demonstrates the impact of signals on company value and explains how shareholder incentives continue to promote management's output of high-lever signals.Based on the above research,this paper solves two problems:First,it provides decision-making suggestions for how the company's management chooses the stock of interest expense liabilities to maximize the company's value.Secondly,it proves to the company's shareholders that the highly leveraged signal is conducive to improvement.Company value and encourage shareholders to provide incentives for management to achieve the effect of high leverage signals on the company's continued value.