Case Study On The Controlling Shareholder's Equity Pledge Of Yinji Entertainment And Media

As a common financing method,equity pledge is increasingly favored by China's listed companies.For the pledgor,the equity pledge is less affected by the supervision and management of the China Securities Regulatory Commission.Compared with other financing methods,the equity pledge does not have too complicated and cumbersome approval procedures,and usually does not control the controlling shareholder of the listed company.Cause an impact.For the pledgee,the equity has the characteristics of convenient circulation and easy realization,and the pledgee has lower costs and risks in disposing of the pledged stock.Because of this,many industries in China with financing difficulties tend to use equity pledges to obtain funds,resulting in a surge in the number of pledged stocks.The paper selects Yinji Media,which has the highest equity pledge ratio in the film and television industry,as a case company.It has a certain representativeness.A study on the equity pledge default event of its controlling shareholder can provide other listed companies in the same industry how to prevent the occurrence of equity pledge default events.The effective reference also has important practical significance on how to restrain the controlling shareholder from using the equity pledge to infringe the interests of small and medium shareholders.The paper defines the concept of equity pledge on the basis of sorting out relevant literature at home and abroad,clarifies the relevant theories required for case analysis,and makes the following introduction and analysis of the equity pledge case of the controlling shareholder of Yinji Media: First,the Yinji Media shareholder's equity pledge ratio,capital investment and default results are summarized.Then,according to the actual operating conditions of Yinji Media,the motives for controlling shareholders 'equity pledges were analyzed,and the degree of deviation of control rights and cash flow rights after equity pledges was calculated using La Porta calculation method.This is the starting point,using the event research method to analyze the short-term market effect of the controlling shareholder's equity pledge,sum up the economic consequences and risks caused by the controlling shareholder's equity pledge default,and draw inspiration and conclusions.The results of the study indicate that the high percentage of frequent shareholding pledges of the controlling shareholders of Inji Media will induce the controlling shareholders to infringe the company's interests.The channels of interest encroachment of the controlling shareholders of Yinji Media include non-operating capital occupation,related party transactions and cash out.Longitudinal comparison of the short-term market effect of equity pledges at different points in time in Yinji Media found that the higher the pledge rate of the controlling shareholder of a listed company,the more the market will take a negative attitude towards the company 's pledge behavior,which in turn will have a negative impact on the company.The paper draws the following enlightenments and suggestions through research: pay attention to the capital management after equity pledge,limit the proportion of controlling shareholders 'equity pledge and the use of funds;strengthen the checks and balances on controlling shareholders,and enhance the right of small and medium shareholders to speak in major matters,Strengthen the risk prevention of equity pledge creditors;the government and regulatory authorities should improve the information disclosure system for equity pledges and improve relevant laws and regulations on equity pledges.