A Study On The Reduction Behavior Of Major Shareholders After The Return Of China Concept Stock Companies To A-Share Market

Variations in valuation of domestic and foreign capital markets and development dividends in the Chinese market have led many China Concept Stock Companies listed overseas to choose to return to China's A-share market.However,in the process of successful landing in A-share market,China Concept Stock Companies has produced a large number of restricted shares.With the lifting of restrictive provisions,reduction of restricted shares has become an important way for shareholders to make profits.Although there are many restrictions on the reduction of large shareholders in China's laws and regulations,and the introduction of the new regulation in May 2017 further improved the supervision of the reduction of large shareholders,the phenomenon of the reduction of large shareholders is still prominent.Large shareholders,as insiders of the company,have natural information advantages.In the process of reduction,the major shareholders can not only accurately know the company's business situation,but also choose the timing of company information disclosure,so as to achieve the goal of profit or risk aversion.Such reduction makes secondary market investors in a passive position,which does not conform to the "three public" principle of capital market and is not conducive to the orderly development of capital market.As the first medium-sized stock to return to Ashare market,Focus Media has experienced the whole process from "return-stock price rising-large shareholders' reduction-producing reduction effect",Focus Media's large shareholders' reduction behavior has research value,because the company has experienced the whole process from "return-stock price rising-large shareholders' reduction-producing reduction effect".Further more.the major shareholders who reduced Focus Media's stocks in 2017 are mainly financial strategic investors.SO,we can better study difference between such strategic investors and controlling shareholders..Therefore,the reduction of the majority shareholders in Focus Media is both representative and typical.This paper will take the case of the reduction of the majority shareholders in Focus Media as a case study.This paper mainly adopts the method of case analysis.This paper combs the relevant research theories about the motivation,timing and economic consequences of the stock reduction of large shareholders,and then makes a theoretical analysis of the motivation,timing and economic consequences of the reduction of large shareholders' holdings.On this basis,this paper use the case analysis method to study how the information superiority act on the motivation and the timing of the reduction of large shareholders in Focus Media.Furthermore,the mechanism and the economic consequences caused by the stock reduction of large shareholders are analyzed.Finally,the Enlightenment of the case is obtained.To a certain extent,this paper enriches the theoretical research on the reduction of large shareholders,and provides the basis for protecting investors,improving the insider trading system in China,and strengthening the supervision of the reduction of large shareholders in China Concept Company.This paper is divided into six parts.The first part is the introduction.This paper mainly clarifies the background and significance of the research,and introduces the research content,research methods and innovations of the paper.The second part is the literature review at home and abroad.This part mainly combs the domestic and foreign scholars' theoretical research on the motive,timing and economic consequences of the reduction of large shareholders,and makes literature review,on the basis of which further refines the theoretical basis and innovative points of this study.The third part is the theoretical analysis of the reduction of the majority shareholders.This part defines the core concepts involved in this paper,elaborates the basic theories used in this analysis,namely asymmetric information theory,principal-agent theory,control rights income theory.Based on these theories,it analyses the motivation,timing and economic consequences of the reduction of large shareholders.The fourth part is the case introduction of the shareholder reduction of Focus Media.This part introduces the general situation,background of the case and the process of the reduction of the majority shareholders.The fifth part is the case analysis of the reduction of the majority shareholders of Focus Media.This part mainly analyses the motivation,timing and economic consequences of the reduction of large shareholders from the perspective of information superiority.The sixth part is case enlightenment.This part summarizes the results of the previous analysis,and draws relevant enlightenment on this basis.The main conclusions of this case study are as follows: Firstly,the four major shareholders of Focus Media have judged the overvaluation of company value and operational risks based on information superiority,which is also the main reason for their reduction.The major shareholders have realized profits and avoided risk through reduction.Secondly,the four major shareholders of Focus Media can choose the right time to reduce their holdings based on their information advantages,and they can make proper use of the company's information disclosure in the process of reducing their holdings.Finally,the reduction of four major shareholders obtained excess profits,but also damaged the value of the company,and the EVA of the enterprise economy dropped sharply to negative value.Through case study,the main enlightenment of this paper is: on the corporate governance level,on the one hand,we should optimize the ownership structure of listed companies to avoid "dominant share",achieve equity checks and balances,and enhance the governance enthusiasm of small and medium-sized shareholders.On the other hand,we should improve the exit mechanism of financial strategic investors,so as to avoid the impact on the market caused by a single way of reduction and withdrawal.As far as market supervision is concerned,on the one hand,we should improve the information disclosure system of major shareholders' reduction,especially the information disclosure system of bulk trading system,so as to prevent bulk trading system becoming a hotbed of major shareholders' reduction.On the other hand,we should increase the punishment of illegal reduction,strengthen the supervisory and punishing power of the China Securities Regulatory Commission,and gradually introduce civil compensation and criminal proceedings in the way of punishment..