Research On The Governance Effect Of Private Equity Investment In The Mixed Reform Of State-owned Enterprises

State-owned enterprises are an important driver of China’s economic development and play the goal of national regulation and control of the economy.However,the rise of private company and foreign-funded company is a main measure forward in the amendment of the market economy.State-owned company exposed many institutional weakness during this period,such as low administrative efficiency and lack of business vitality.Therefore,the integration of state-owned enterprises and non-public capital can learn from each other and make up for each other,so as to make the market economy develop healthily.In the 1993,the Third Plenary conference of the CPC Essential Committee adopted a series of decisions,in which state-owned company should construct a modern enterprise system.The report of the 16 th National Congress in 2002 pointed out that economic planning and architecture should continue to be adjusted.In 2013,the Third Plenary Convention of the CPC Important Committee was held.The focus of the session was still to promote the amendment of mixed ownership and let more public-owned capitals and other capitals to develop mixed ownership in the economy.In 2019,the SASAC suggested that the reform of state-owned company needs to ameliorate governance,strengthen incentives,highlight the main business and improve efficiency.The participation of non-public funds in the reform of public-owned companies is expected to improve the administration mechanism,arouse the operating productiveness and stimulate the vigour of the public-owned company market,so as to obtain the capital report,which is also the fundamental purpose of the reform of mixed ownership of state-owned enterprises.In recent years,private equity has increased significantly from raising funds to investing abroad.It has distinctive advantages in participating in the reform of public-owned companies and can play a greater affect in deepening the reform of public-owned companies.Therefore,it is of great implication to learn how personal equity invest funds can participate in the mixed reform of public-owned companies,improve its governance mechanism,improve corporate efficiency,and help enterprises become bigger and stronger.This paper selects Zoomlion as a case company.First,it introduces the policy background of this paper,combs the relevant literature of mixed ownership and private equity investment and the basic theories involved;Secondly,this paper analyzes the basic situation of private equity investment participating in the mixed reform of state-owned enterprises,and introduces the growth process and the latest situation of the mixed reform of public-owned companies,as well as the essential situation of personal equity investment and the latest advance of participating in the mixed reform of public-owned companies.Finally,this paper describes the process and motivation of Hony Capital’s participation in Zoomlion’s hybrid reform.Through analysis,it is found that Hony Capital’s participation in Zoomlion’s hybrid reform has a positive effect on the company’s equity structure,board governance and corporate strategy,and the value of state-owned assets has been increased.The research conclusions of this paper are as follows:(1)Private equity investment as a strategic investor participating in the mixed reform of state-owned enterprises has improved the equity structure of "one share dominates",upgraded the contemporary corporate governance framework of public-owned companies,and improved the specialization of public-owned companies decision-making;(2)Private equity investment empowers the reform of state-owned enterprises through its own management experience and high-quality resources,improves the management productiveness of public-owned companies,and improves the inherent value of public-owned companies;(3)Private equity investment has rich industrial resource integration ability and international M&A experience.Through actively participating in the strategic M&A of state-owned enterprises,it provides state-owned enterprises with assistance in M&A programs,financial support,project investment experience and investment risk control,so that state-owned enterprises can achieve industrial resource optimization.