Analysis On The Motivation Of Pledge Of Shareholder's Equity And The Risk Of Control Transfer

In recent years,the number of cases of stock right pledge explosion has been increasing,and the risk of stock right pledge has gradually become the focus of market attention.For large shareholders with high proportion of equity pledge,the motivation of pledge is different,and the risk of pledge is mainly reflected in the impact on their control rights.During the period of equity pledge,the control transfer risk of the major shareholders is mainly affected by the fluctuation of the stock price of listed companies.Once the stock price falls to the liquidation line,the major shareholders need to find other channels to replenish their positions.The improper operation in the process of replenishing warehouse will aggravate the escalation of the risk of transfer of control rights,which will not only cause the liquidation crisis not to be solved,but also lead to the further deterioration of the capital chain and affect the market value of the company.Therefore,the study on the motivation of equity pledge and the risk of transfer of control rights has certain theoretical value and practical significance.Qin Shang shares listed in 2011,is a subsidiary company of Qin Shang Group,mainly engaged in LED road lighting,LED display and other lighting components.Affected by the global market downturn and the intensification of industrial competition,the company decided to make a strategic transformation to the education industry in 2015.During this period,Li Xuliang,the major shareholder of Qinsheng Stock Company,and his concerted actors made two high-proportion pledges of shares,which led to the stock price falling to the liquidation line due to the poor operation of the enterprise.In the process of replenishing warehouse,due to the inadvertent financing of large shareholders,the second transfer of control rights occurred.After that,although the storm subsided,the stock price of the company remained depressed,and the risk of controlling rights transfer of major shareholders still existed.This paper chooses Qinshang Co.,Ltd.as a case study,and on the basis of combing the previous literature on equity pledge,determines the research content and direction of this paper.In the basic part of the theory,the theory of information asymmetry and the theory of control right are elaborated in combination with the content of this paper.In the case introduction part,the paper gives a detailed introduction to Qin Shang shares and major shareholders,and makes an in-depth analysis of the characteristics of equity pledge.In the case analysis part,the motivation of the pledge of largeshareholders' equity,the process and results of the risk upgrading of the transfer of control rights are analyzed.Finally,the problems faced by large shareholders in the process of equity pledge are summarized,and the conclusions and countermeasures are given.Through the research,it is found that the reason for the large shareholders' high proportion of equity pledge is the shortage of large shareholders' funds,which is rooted in the imperfection of the company's development strategy and financing mode.On the motivation of equity pledge,the major shareholders,on the one hand,are to consolidate their control over the company,on the other hand,are likely to embezzle the company's interests.Under the background of effective capital market,the motivation of equity pledge will affect stock price and control risk.After the large shareholders pledge their high proportion of shares,the risk of control transfer is not only affected by the fluctuation of the stock price of the pledged shares,but also indirectly affected by the risk of control transfer of the parent company.