Research On The Issuing Motivation And Effect Of Private Exchangeable Bonds

Private exchangeable bonds have developed rapidly in China since 2013.The number and scale of issuance reached the highest value in 2017,but there was a significant decline in 2018.Private exchangeable bonds have enriched the variety of bonds and improved the efficiency of the capital market.At the same time,there are some problems.Through descriptive statistics and case analysis,this paper studies the motivation and effect of the issuance of private exchangeable bonds,expecting to expand the scope of research in this field and provide more experience for potential issuers,investors and other stakeholders.Firstly,this paper combs and summarizes the historical literature on the motivation,effect,risks,problems and Countermeasures of the issuance of private exchangeable bonds,and concludes that the motivation of issuance can be basically summarized as financing and reducing holdings,the performance impact is mostly positive,the market response varies with the object of study and angle,but mostly is negative,and the problems and countermea sures focus on risk awareness,regulatory scope and information disclosure.Subsequently,this paper elaborates the definition and characteristics of private exchangeable bonds,and analyses how to judge the motivation of private exchangeable bonds from the three angles of issuer,listed company and issuing terms.Then,this paper expounds the stakeholders,information asymmetry and principal-agent theory.Subsequently,this paper makes descriptive statistics on the issuance scale and quantity,issuance terms and withdrawal modes of private exchangeable bonds,and judges the motivation of issuance of non-maturing private exchangeable bonds by each unit through relevant provisions,which can be divided into two categories: financing needs and share holding reduction.Finally,this paper analyses the process and motivation of issuing private exchangeable bonds by case companies,and studies the effect of issuing private exchangeable bonds from four perspectives: issuer of private exchangeable bonds,target listed companies,investors of private exchangeable bonds and minority shareholders of listed companies,and draws the conclusion of this paper and puts forward some suggestions.This paper draws four conclusions: at present,most of the issuance of private exchangeable bonds is due to shareholding reduction,private exchangeable bond is a good channel for issuers to reduce their holdings and raise funds,and Rainbow Venture Capital is in an advantageous position in the process of gambling with investors of private exchangeable bonds.At the same time,due to the reasonable use of the funds raised by private issuance of shares,their profitability has been improved,and the capital structure has been optimized.However,after the issuance of private exchangeable bonds and the completion of investors' equity swap,the stock price of the listed companies has dropped significantly,resulting in the loss of the interests of minority shareholders.Finally,this paper puts forward suggestions from three a spects: the issuer should accurately grasp its issuing motivation and set reasonable terms;investors and small and medium-sized shareholders of listed companies should enhance risk awareness;the regulator should expand the scope of supervision and further refine the rules.