Research On The Role Of Exchangeable Bond In Financing ——Taking Sany Group As An Example

Exchangeable bonds originated in the United States in the 1970 s,but it appeared late in China,by the end of 2014 Chinese bond market issued a total of six exchangeable bonds.The expansion of the issuer in 2015 and the implementation of new reduction regulations in 2017 have contributed to the expansion of the size of exchangeable bonds.As a new type of bond on the market,exchangeable bonds can not only help issuers to achieve low-interest financing,but also help issuers to reduce their holdings of listed companies smoothly.However,at the same time,with the rapid development of Chinese exchangeable bond market,there are still some problems in the market,which is not conducive to the further development of the exchangeable bond market.The research method adopted are case study and event study.At first,this paper introduces the definition、issue elements、types and motivations of exchangeable bonds,and then summarizes the research results of domestic and foreign scholars,it is found that the research of exchangeable bonds done by Chinese scholars is mostly concentrated on theory,less on case study.Then,this paper analyzes the current status of Chinese exchangeable bond market,and finds that most exchangeable bonds’ scale are small,the coupon rate varies a lot,the issuer’s motive is not pure,the information disclosure is insufficient and the market’s understanding of exchangeable bonds is far from deep.The reasons are multidimensional: on the one hand,the enterprise’s understanding of their own is not comprehensive enough to lead them to make a better choice in financing;on the other hand,the regulatory construction and the current credit rating mechanism of the market need to be further improved and investors also need to be more rational.In the case part,this paper introduces the process of issuing two exchangeable bonds by Sany Group in detail,and analyzes the motive and results,finding that Sany Group’s issuing is mainly to supplementary working capital,and secondary is for reducing the holding stake to obtain capital gains.In addition,this paper also summarizes that reasonable financing method,appropriate timing of debt issuance,potential subsidiary and appropriate terms and conditions have contributed to the success of Sany Group’s bond issuance.In the last part of the case study,this paper also respectively summarizes the risks from the issuer and the holder.The final is the enlightenment and suggestion part.Through the analysis in the fourth part,this paper gives other enterprises some advice in the choice of financing,thinking that enterprises should fully consider the situation of the enterprise itself before financing,and if they choose bond financing,the stock-bearing bonds are better than others.In view of the existing problems in Chinese exchangeable bond market,this paper puts forward the following solutions:（1）exchangeable bond is a new type of bond,in order to prevent the emergence of vicious arbitrage events,the regulators should strengthen regulations,and require enterprises to strengthen the disclosure of information on the motivation of debt issuance;（2）the relevant departments should also strengthen the construction of the credit rating system of the market;（3）in order to prevent issuers from manipulating stock prices or arbitrarily modifying the terms,the relevant institutions should also strengthen the qualification examination of issuers;（4）relevant departments,enterprises and investors should strengthen their study of exchangeable bonds,so that the market will be in a rational state,which is conducive to the healthy development of the market.