The Motivation And Economic Consequences Of The Shiji Information Private Placement

After the share-trading reform was completed in May 2006,private placement as a way of refinancing has become increasingly popular in China’s capital market.Compared with public offerings,allotment and other financing methods,private placement has the advantages of low threshold,easy operation and high financing efficiency.It is gradually becoming the main mode of refinancing stocks of listed companies.Therefore,why listed companies need to raise funds through private placement and how to effectively and effectively use the funds raised for the company’s business development are topics worthy of further study.Based on this,this paper uses case study method,taking Shiji Information Technology Co.,Ltd.as a subsidiary of Alibaba Group’s subsidiary Taobao(China)Software Co.,Ltd.as an example,from the motivation and economic consequences of private placement.The aspect is to conduct research.Firstly,it sorts out and summarizes the research results of predecessors,and extracts the theoretical basis of this paper.Then analyzes the development status of private placement and provides realistic support for this research.It summarizes the orientation of stone-based information from the macro-environment and stone-based information.The motivation for additional issuance,and finally analyze the economic consequences of its private placement.The study found that: consolidating the main business,introducing strategic investors,optimizing the governance structure and capital structure are the main drivers of this private placement.Shiji Information introduced strategic investors through the private placement method to optimize the governance structure and generate a positive market reaction.,to some extent,improve the financial performance of the company.Finally,this paper provides suggestions for other companies in China to introduce strategic investors through private placement from the scale of private placement,the choice of objects,the use of raised funds,and the risk of preventing control.