Research On The Mechanism And Effect Of Dual Shareholding Structure On The Economic Benefits Of Xiaomi Group

On April 24,2018,the Hong Kong Stock Exchange issued new IPO rules allowing dual-class companies to list.Three months later,Xiaomi became the first dual-class company to list.Xiaomi’s dual-class share structure is realized by issuing "AB shares" with different voting rights.A shares are granted super voting rights and are generally owned by the founder or founding team,while B shares have one vote for each share,just like ordinary shares.In this way,companies bring in capital while ensuring that the founder and his team still enjoy a high level of voting power,maintain control of the company and prevent other shareholders from influencing the company’s major operating decisions.This paper first starts from the theoretical level,sorts out the theoretical basis of dual shareholding structure,incomplete contract,control and other theoretical bases and relevant literature at home and abroad.Then introduced Xiaomi’s financing situation and listing process;Then,the impact of dual shareholding structure on the control of the founder of the enterprise is analyzed,and the economic benefits of the company are affected from three aspects: strategic layout,cultural inheritance and corporate governance;Then,through the comparison with Lenovo Group,the impact and effect of dual ownership structure on Xiaomi’s economy are introduced from three aspects: market performance,financial performance and non-financial performance.Studies have shown that the dual shareholding structure can not only improve the governance efficiency of the company,but also expand human capital,ensure strategic execution,and improve the core competitiveness of enterprises.Finally,it is concluded that the supervision mechanism that may occur after the implementation of the dual shareholding structure of Xiaomi is not perfect,damages the rights and interests of small and medium-sized shareholders,and is more dependent on the founder’s ability and moral level,and puts forward suggestions for establishing and improving the internal power check and balance mechanism,improving the protection mechanism for small and medium-sized shareholders,and paying attention to the improvement of the ability of managers.The innovation of this paper is that: First,with the help of typical cases,the impact of dual ownership structure on the economic benefits of Xiaomi Group is explored by dissecting sparrows,so as to clarify the relationship between dual ownership structure and enterprise economic benefits more finely.Secondly,it tries to explore the mechanism of the dual equity structure on the economic benefits of enterprises,and then reveals the deep-seated reasons why the dual ownership structure affects the economic benefits of enterprises.Due to the influence of the system,the number of dual-class share structure listed companies in China is small.Through the study of this paper,we hope to enrich the domestic theories on dual-class share structure and control rights,and at the same time to provide a reference for enterprises that want to achieve long-term development through dual-class share structure.