The Case Analysis Of The Transfer Of Control Rights Caused By The Pledge Of The Actual Controller's Equity

Actual controllers often need a lot of capital to participate in and maintain the business expansion of enterprises for their own interests or for the future development prospects of enterprises.When the self-owned capital fails to meet the demand,the actual controller starts to seek low-cost and simple financing methods,and then the pledge of equity is taken out.As a hot spot of financing nowadays,equity pledge not only increases the scale of equity pledge year by year,but also increases the ratio of equity pledge rapidly.Equity pledge has become one of the financing methods favored by shareholders of listed companies.As of July 2018,shareholders of 3,338 listed companies have conducted equity pledge financing,accounting for about 13% of the total market value of a-shares.According to statistics from Wind information,most pledgers of equity pledge are major shareholders of listed companies.From 2013 to2018,the number of listed companies with equity pledge increased exponentially.Equity pledge is a double-edged sword,not only has the good side,but also accompanied by the bad side.Equity pledge converts the equity of the shareholder into capital,which is converted from static book data into liquid monetary capital and makes the capital circulate again.However,while enjoying the financing convenience,the pledgor also faces the risks brought by the equity pledge financing,especially the actual controller needs to pay special attention to the risks brought by the equity pledge.Generally,the actual controller is out of his own interests and absolute control position,so long as it involves control rights,he must think twice.However,in the face of the convenience and blind confidence brought by equity pledge,he blindly ignores the risk of transfer of control rights that may be caused by equity pledge.Most of the existing literature studies also focus on the motivation of equity pledge,the separation of two rights and the agency problem,etc.Most scholars have doubts about whether equity pledge can really lead to the transfer of control.If the capital market policy is loose,the pledge of equity can indeed improve the capital liquidity of listed companies,so as to enhance the asset value.However,in the policy tightening capital market environment,once the stock price of the listed company falls,the liquidation pressure of the pledged stock will increase sharply due to the decline of the stock price,and then trigger the irrational decline of the stock price,creating a vicious circle.Therefore,the in-depth study of the relevant measures of the actual controller's equity pledge risk and risk response of listed companies is not only of theoretical significance to the standardoperation of equity pledge in the capital market in the future,but also of practical significance to the actual controller's equity pledge operation of listed companies.By combining theoretical analysis with case analysis,this paper first systematically introduces the concept and relevant theories of the equity pledge of the actual controller,and then explores the causes and consequences of the risk of control transfer caused by the unreasonable equity pledge behavior of the actual controller of Jinyi Culture.This paper is composed of five parts: the first part is the introduction,mainly introducing the research background and significance,relevant research literature,research ideas.The second part is the theoretical of the pledge of shareholders' equity of listed companies,which is the theoretical part of this paper.This paper mainly introduces the concept and characteristics of the actual controller and the pledge of equity,the motivation of the pledge of major shareholders' equity,the possible adverse effects caused by the pledge of the actual controller's equity,the theoretical explanation of the pledge of equity and the situation of China's listed companies' equity pledge and relevant legal norms,laying a theoretical foundation for the analysis of this paper.The third part is the case introduction of the equity pledge of the actual controller of Jinyi Culture,which is the case introduction part of this paper.It mainly introduces the basic situation of the case company,the process of the actual controller's equity pledge and the risk generation,and the motivation of the actual controller's equity pledge.The fourth part is the analysis of the economic consequences and causes caused by unreasonable pledge of stock rights of the actual controller of Jinyi Culture,which is the case analysis part of this paper.It mainly includes the influence of the equity pledge of the actual controller of the case company on the company and the specific reasons for the risk of control transfer.The fifth part is the conclusion and suggestion.This paper mainly summarizes the improper behaviors of equity pledge of the case company,and puts forward targeted policies and Suggestions.The contribution of this paper lies in the following aspects:(1)different general to consider how to hedge the risks of control transfer,and combining with the actual controllers of listed companies as a result of equity pledge over control of real cases,analyzes the reason of actual controllers for equity pledge,and the reason of control transfer risk to the economic consequences of the listed company,provides an equity pledge that control transfer case study;(2)it is intended to improve the major shareholders' awareness of the risk of equity pledge,and reveal the undesirability ofstock suspension self-rescue,secret maintenance of stock price stability,use of major good news to stimulate the stock price and other means to avoid equity liquidation;(3)the research of this paper has certain enlightening effect on the regulatory authorities and investors.Although reasonable and appropriate equity pledge can make the pledgor obtain positive and positive effects,the excessive proportion of equity pledge hides the huge crisis of the pledgor,which requires the regulatory authorities and investors to pay special attention to.