A Case Study Of Secote Precision Electronic Co.,ltd Acquisition Financing By Private Placement Convertible Bonds

As China's economic structural reforms enter the deep-water zone,financial deleveraging has also entered a period of toughness,and downward pressure on the macro economy has increased,increasing the average financing cost of the real economy.At the same time,the increase in economic uncertainty has accelerated the deleveraging of the real economy,leading companies to have to improve their capital structure and increase their ability to resist risks,thereby increasing the financing constraints they face.In 2018,the M & A market was pre-cooled,and financing payments became a bottleneck in the market.The CSRC actively promotes the pilot policy of using directional convertible bonds as a payment tool for mergers and acquisitions,and supports various enterprises to become better and stronger through mergers and acquisitions.Saiteng became the first listed company to try to use directional convertible bonds as a payment tool for mergers and acquisitions.By studying the motivations for the issuance of Saiteng's directional convertible bonds,the effect of issuing directional convertible bonds on mergers and acquisitions,and the research on the risk of issuing convertible bonds to promote the use of directional convertible bonds to accelerate the recovery of the M & A market and the improvement of policy regulations It is extremely important for reference.This paper takes the case of Saiteng's issuance of directional convertible bond financing and merger and acquisition of Lingou Technology,and analyzes the motivations of Saiteng's issuance of directional convertible bonds based on the macroeconomic situation,the company's self-strategic planning and financial status.The analysis shows that the advancement of the pilot policy of directional convertible bonds is a timely rain for Saiteng,which relieves Saitan's financial pressure and accelerates the M & A process.Secondly,the comparative analysis method and the event research method were used to analyze the role of directional convertible bonds in this M & A.The conclusion shows that: first,the flexible clause design of the directional convertible bond balances the interests of both parties;second,the directional convertible bond compares cash payment and share payment to control the bondholder 's expected rate of return within 30% and the bond interest The rate of only 0.01% effectively reduces financing costs.Third,directional convertible bonds,as a key tool for achieving performance compensation and rewards and asset impairment compensation mechanisms,effectively prevented the valuation premium risk and human resources integration risk during the merger and acquisition integration stage by adjusting the transaction consideration.Finally,it analyzes the possible risks of directional convertible bonds during this M & A process.Regardless of the uncertainty of operating performance and the risk of redemption caused by early resale clauses,or the uncertainty of the conversion price and policy,Saiteng requires The shares have the ability to repay unlocked directional convertible bonds at any time.According to the case analysis and conclusions,two enlightenments were obtained: First,the directional convertible bonds still showed strong applicability in the weak market environment of the macroeconomic downturn,rising financing costs and stricter financing supervision.The financing channels of the M & A market are expected to lead the M & A market to pick up.Second,changes in financing policies issued by the government will affect the choice of payment instruments in corporate mergers and acquisitions.The government can use the changes in financing policies to actively guide companies to use reasonable payment methods,enrich payment channels for mergers and acquisitions,and promote the deleveraging process of physical enterprises Strengthen the ability of physical enterprises to resist risks and respond to changes in the macro environment.At the same time,we can learn from foreign mature capital market experience and combine China's market environment to improve relevant laws and regulations,so as to find a relatively balanced point between policy supervision and support for market economic freedom.