Research On The Impact Of Private Equity Investment On Company Value

At present,China is in the period of economic transformation.In order to promote the transformation and upgrading of industrial structure,the government encourages the development of emerging industries and high-tech enterprises.However,high-tech enterprises have higher risks and are not easily supported by traditional financing methods.Private equity investment prefers to invest in high-risk,high-yield enterprises,which has alleviated the difficulty of financing high-tech enterprises to a certain extent.So more and more high-tech enterprises begin to seek help from private equity,which has led to rapid development of private equity.In this context,it is of great practical significance to study whether private equity investment really plays a role in enhancing the value of the invested company.This paper adopts a combination of normative and empirical analysis,using principal-agent theory and social network theory to conduct a standardized analysis of the impact of different characteristics of private equity investment on company value.At the same time,678 high-tech enterprises listed on GEM from 2009 to 2017 were selected as research objects.The value of the company was measured by Tobin q value.After correlation and multi-collinearity test,multiple regression models were established to empirically test different characteristics.The impact of private equity investment on the value of companies listed on the GEM.The results of the study show that,first,the value of companies participating in private equity investment is significantly higher than that of non-private equity investment companies.Secondly,from the perspective of the nature of private equity institutions,the private placement with foreign investment background has a more significant effect on the value of the company than the private placement without foreign investment background.The private equity of the state-owned background promotes the value of the company more than the private equity of the private background.Third,the higher the shareholding ratio of private equity investment and the higher the reputation,the better the company’s value of the invested company.In addition,private equity institutions using joint investment to invest can effectively enhance the company value of the invested company.