| With the economy entering the "new normal",China’s economy is facing many challenges and difficulties both at the macro and micro levels,among which deleveraging to adjust structural contradictions has become a major theme of China’s economy.Under the mechanism of high leverage,rigid payment exists in a wide range,resulting in unreasonable allocation of resources,failure of market mechanism and excessive allocation of capital to certain sectors,especially state-owned enterprises and local governments.And as capital builds up in these sectors,returns will gradually fall.At the same time,private enterprises will be faced with less than a question of money,and take the lead to be squeezed out when tightening,the capital structural mismatch,will reduce China’s potential growth rate for a long time,make our country enterprise profit growth decline,high interest payments,their huge financial burden,unable to repay bank loans,and will further lead to bad loan ratio of rapid ascension.In this context,state-owned enterprises generally bear to reduce the asset-liability ratio of the assessment indicators.Shandong gold mining co.,LTD.(hereinafter referred to as "shandong gold")and the China shipbuilding heavy industry co.,LTD.(hereinafter referred to as "China’s heavy industry"),the two companies implement debts into shares,convertible way through debt response national policy,reduce leverage enterprise,improve enterprise management and financial burden,and improve profitability.However,shandong gold and China heavy industry have different debt-to-equity schemes in design.Taking the two typical state-owned enterprises implementing market-oriented debt-to-equity swaps as examples,this paper explores the effective implementation path and application effect of market-oriented debt-to-equity swaps,so as to provide reference for state-owned enterprises to implement market-oriented debt-to-equity swaps in the future.Based on the review of relevant literature at home and abroad and the summary of relevant concepts and theories,this paper expounds the development status of state-owned enterprises’ market-oriented debt-to-equity swap.This paper introduces the general situation of shandong gold and China heavy industry.This paper explains the application background,purpose and specific operation process of shandong gold and China heavy industries’ implementation of market-oriented debt-to-equity swaps,and then studies the financial effects of market-oriented debt-to-equity swaps of these two enterprises based on three financial indicators: solvency,operating capacity and profitability.Finally,by comparing the characteristics and differences between shandonggold and China heavy industry in the main body of participation,the way of capital increase,the classification of capital increase and the arrangement of exit mechanism,the author further excavates the case to get enlightenment and Suggestions,and then draws the conclusion of this paper.By combing and analyzing the cases,this paper draws the following conclusions:first,there is a big difference between the market-oriented and legalized debt-to-equity swaps in China and the first round of policy-based debt-to-equity swaps.The new round of debt-to-equity swaps lays more emphasis on the role of the market and the rule of law.Second,through the analysis of the design of the debt-for-equity swap clauses of the case company,it is found that shandong gold only achieved the deleveraging "on the book",and the capital increase of its investors is essentially a financial liability,and did not really achieve the goal of deleveraging.China heavy completed the deleveraging task through the model of capital increase followed by unconditional equity buyback,and truly realized the deleveraging target.Third,in the context of deleveraging,the "capital increase before unconditional repurchase" model of China heavy industry is a more optimized debt-to-equity swap path,which can help enterprises to achieve the goal of deleveraging more effectively. |
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