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Question 2: What does private equity mean? 1) In terms of fund raising, it is mainly raised by a few institutional investors or individuals in a private way, and its sales and redemption are carried out by fund managers through private consultations with investors. In addition, the investment method is also carried out in the form of private consultation, which rarely involves the operation of the open market and generally does not need to disclose the details of the transaction.
2) More equity investment is adopted, and debt investment is rarely involved. Reflected in investment instruments, common stock or transferable preferred stock and convertible bonds are commonly used. Therefore, PE investment institutions enjoy certain voting rights in the decision-making management of the invested enterprises.
3) generally investing in private companies, that is, unlisted companies, and rarely investing in publicly issued companies, will not involve the obligation of tender offer.
4) The investment period is long, generally reaching 3 to 5 years or longer, which belongs to medium and long-term investment.
5) The liquidity is poor, and there is no ready-made market for the transferor of the unlisted company to directly reach a deal with the buyer.
6) There are many sources of funds, such as wealthy individuals, strategic investors, pension funds and insurance companies.
7)PE investment institutions mostly adopt limited partnership system, which has good investment management efficiency and avoids the disadvantages of repeated taxation.
8) Diversified investment exit channels, including IPO, transaction sale and M&A; A), the target company management repurchase, etc.
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Question 3: What is private equity investment? Private equity investment is the equity of establishing a private equity investment company. Individuals cannot participate in equity investment through the growth of the company. The threshold is 654.38+00,000. You can go to the partnership to see. It seems that they are setting up a company to raise equity.
Question 4: What does private equity investment mean? Private equity refers to the unlisted equity or non-publicly traded equity of listed companies.
The source of funds for private equity investment can be raised from unspecified public, or it can be issued to institutions or individuals with risk identification and tolerance. Due to the high risk of private equity investment and insufficient information disclosure, it often takes the form of non-public offering. Private equity investment funds invest in corporate equity rather than the stock market, that is, buying equity rather than stocks. This property of PE objectively determines the long return period of investment.
Question 5: Excuse me: Are equity investment and private equity investment the same thing? If not, what's the difference? This is one thing. That's what I do. This "private equity investment" is a mistranslation of English expression gradually formed in China's industry practice, so it has become a habit. Equity investment is called "Private Equity" in English, and the word Private originally meant to invest in the equity of unlisted companies. When I came to China, the funds invested in such projects were all private, not public, and there was a difference between "Public Offering of Fund" and "private fund" in the stock, so it was wrongly translated as "private equity". In fact, in foreign countries, equity investment is also publicly issued and traded on exchanges, that is, foreign public equity investment funds invest in unlisted companies. From the original intention, in fact, the most appropriate translation of private equity should be "private equity investment", that is, the shareholders of the invested company are not the public. I hope it helps.
Question 6: What is private equity investment (PE)? It refers to equity investment in private enterprises, that is, unlisted enterprises, through listing, mergers and acquisitions or management buybacks. Make a profit by selling stocks. Broadly speaking, private equity investment covers all stages of equity investment before initial public offering, that is, investment in enterprises in seed stage, initial stage, development stage, expansion stage and maturity stage. So private equity investment also includes venture capital [1].
China, as the fastest growing economy in the world, coupled with the improvement of the investment environment and the long-term trend of RMB appreciation, has made a high return on its investment in China assets, which makes private equity funds pay more and more attention to the "China Strategy". China has also become the most active private equity investment market in Asia. Private equity investment institutions invested 129 in Chinese mainland, with 77 participating investment institutions, and the overall investment scale reached12.973 billion US dollars.
Enter mode
Capital increase and share expansion: enterprises issue new shares to the introduced overseas strategic investors, and all the financing funds enter the enterprise, which is more conducive to the further rapid development of the company. For example, Huaping and CITIC Capital participated in the restructuring process of Harbin Pharmaceutical Group, invested 2.035 billion yuan to increase the capital of Harbin Pharmaceutical and acquired 45.0% of its equity.
Equity transfer: transfer the equity held by the old shareholders to the introduced investors (usually at a high premium) to meet the liquidation requirements of some old shareholders, and the funds obtained from financing are owned by the old shareholders. For example, if PAG takes over 67.4% of the shares of "King of Baby Carriers in China", the transferor AIG, SB and First Shanghai will each get 2-5 times returns.
Generally speaking, capital increase and transfer are mixed. For example, Wuxi Suntech used the old shareholders to transfer shares and increase capital and shares to introduce international strategic investors many times before listing. In foreign countries, there is also a common arrangement, that is, private equity funds take preferred shares (or convertible bonds) as shares, guarantee the minimum return on investment through fixed dividends agreed in advance, and have the distribution right prior to common shares in enterprise liquidation. [2]
In view of some policy restrictions in the domestic investment market, when foreign PE enters, it generally does not choose local entities that directly invest in China enterprises, but reorganizes the enterprises, and injects domestic assets or rights into shell companies by setting up offshore companies or buying shell companies, so that domestic entities become their subsidiaries and raise funds in the overseas securities market in the name of shell companies. This method is commonly known as "red chip listing". In this way, the income and profits of domestic assets can be legally introduced into the overseas holding parent company. The investment and exit of private equity investment funds in China will be conducted overseas with loose control. For example, Shanda Network, as the regulatory authorities stipulate that the business license of Internet content providers must be in the hands of China companies, it has become an essential arrangement to construct the above channels to extradite assets.
In the case of Suntech Solar, Historic Power Solar System Co., Ltd. was established in the British Virgin Islands, and then all the shares of the original shareholders of Wuxi Suntech Solar Power Generation Co., Ltd., a Sino-foreign joint venture, were obtained through this BVI company, thus becoming the shareholders who actually held 0/00% interest in Wuxi Suntech/KLOC. Later, in the process of listing, Suntech Holdings was established in Cayman Islands. Suntech Holdings indirectly holds 65,438+000% interest in Wuxi Suntech by exchanging the shares of Suntech Holdings with the shares of the shareholders of this BVI company, so as to achieve the purpose of domestic enterprises' rights and interests entering overseas listed entities.
Equity design model
The PE investment of domestic enterprises is more flexible in equity design, and with the different purposes of private equity funds [3], their requirements for equity also have different characteristics.
Private equity investment in a broad sense can be divided into venture capital [4], growth investment, M&A fund [5], post-listing private equity investment (namely PIPE)[6], mezzanine investment [7], reorganization/revitalization capital, Pre-IPO capital, bad debt investment, real estate investment and private equity investment funds focusing on specific industries or fields.
Except for major strategic decisions of enterprises, most private investors generally do not participate in the daily management and operation of enterprises. They need to occupy at least one seat on the board of directors and have one veto, and many PE investors will appoint the financial director of the invested company to control the financial affairs of the enterprise. Under normal circumstances, private equity investment funds account for the company's shares ................................................................................................................................................................... & gt
Question 7: What does 7:PE mean? Who can explain it briefly? At present, foreign countries have given its definition, which is not suitable for the actual situation in China, but it is not difficult to understand it literally. It has two elements: one is private placement, which is relative to public offering funds, that is, raising funds from specific investors in a non-public way. Because it invests in the equity of the enterprise, the risk is uncontrollable, so it cannot publicly raise and disclose relevant information. Unlike securities investment funds, it must be strictly examined and approved by the state administrative organs. The second is equity investment, which mainly invests in the equity of unlisted high-growth enterprises and provides management and consulting services for enterprises, with a view to obtaining long-term capital appreciation through equity transfer after the invested enterprises mature, and belongs to equity investment.
Operation process of equity investment fund:
First of all, private equity investment fund is a fund initiated by sponsors and established in a specific organizational form in conjunction with other investors to invest in corporate equity. The fund invests in the equity of the enterprise according to the investment strategy and preference. After 3-7 years, quit in some way to get a higher return on investment.
Organizational forms of private equity investment funds:
In foreign countries, the organizational forms of private equity investment funds are cooperative system, company system, contract system, trust system, etc., but in China, it is mainly partnership system and company system, with partnership system being the most extensive, because partnership system is looser than company system in law and norms. At present, the only applicable law is the Partnership Enterprise Law, which will obviously have more room for operation, and all kinds of laws and frameworks of the company system in China are relatively perfect.
Exit mechanism of private equity investment fund;
The starting mechanism of private equity investment plays an important role in the whole operation system, which determines the success or failure of its operation. In developed countries, this startup mechanism is diversified, which has played a very good role in promoting the development of private equity investment. The exit methods mainly include listing, merger, repurchase and bankruptcy liquidation.
How to identify this special investment institution? What kind of legal development environment is given to it? How to avoid industry risks? How to standardize and promote its development? How to make it promote the development of the region or industry? These are a series of problems before us. As private equity investment is a new thing in China, all levels of * * * and its related institutions have gradually realized it and the necessity of promotion and development, but what kind of institution is it? Which department is in charge of management? How to manage? The "Measures for the Administration of Equity Investment Funds" has not yet been promulgated, which illustrates this point. Only by clarifying these as soon as possible can we sort out and create a legal environment for them. At present, there are many blind spots in partnership enterprise law, company law, securities law, trust law and related tax law, so it is necessary to formulate, integrate or introduce new laws and regulations.
Private equity investment case introduction;
Private equity financing has created many myths about enterprise development, such as Mengniu, Wuxi Suntech, Yongle Electric, Yurun Food, Zhongxingwei, Thousand Oaks Interactive, Guo Min Communication, Shanda, Baidu, Ctrip, Alibaba, Legend in the Wind, Worry-Free Future, Yi Bei, Joyo, Kong Zhong, Focus Media, Pacific Life, Lenovo, Carson Industry and Ping An.
Case1-Wuxi Suntech
Suntech is mainly engaged in the research, manufacture and sales of crystalline silicon solar cells, modules and photovoltaic power generation systems. Suntech was rated as one of the top ten solar cell manufacturers in the world by Photonics International in 2004, and entered the top six in 2005. In May 2005, Suntech conducted the last round of private placement in the global capital market, and investment funds such as Win-Win, Goldman Sachs, Longke, France's Natexis and Spain's Pukai joined in succession. These companies exchanged $80 million in cash for the equity of Suntech 7716 million. In February 2005, it was listed on the new york Stock Exchange with an opening price of $20.35. With a financing of 400 million US dollars and a market value of 265,438+75 million US dollars, it became the first private enterprise in China to land on NYSE. Shi holds 68 million shares, and ranks among the top five in the rich list with the value of $654.38+$383.8 million. Private equity funds have played an important role in the successful listing of Wuxi Suntech.
Case 2-Shanda Network
In March 2003, Shanda Network >>
Question 8: What is a private equity investment fund? Simply put, what is a private equity investment fund? The following explanation is very clear. (For investment, please search | Rong 360 |)
Private equity investment fund refers to private equity investment in unlisted enterprises, and investors share investment income and bear investment risks according to their share of capital contribution. In the process of transaction implementation, the future exit mechanism is considered, that is, through listing, mergers and acquisitions or management buyback. , profit from the sale of shares. However, at present, a small number of private equity funds invest in the shares of listed companies, and some also use debt-based investment, but the above accounts for only a small part.
Private equity funds mainly invest in mature enterprises that have formed a certain scale and generated stable cash flow, which is the biggest difference from venture capital funds. Private placement is relative to public offering. At present, all funds in China are raised through public offering, which is called fund public offering. If a fund does not go through public offering, but privately raises funds from a specific target, it is called a private equity fund.
There are two ways to raise funds, one is through equity, each fund holder is a shareholder of the fund, and the manager is also one of the shareholders. The other is contractual, and the relationship between the holder and the manager is contractual, not equity. At present, public offering funds are all contractual, but at present, China's laws only allow public offering funds to raise funds by contract. Therefore, if you want to set up a private equity fund, you must adopt the way of equity, so there is no legal obstacle.
Question 9: What does private equity investment fund mean? In short, what is a private equity investment fund? The following explanation is very clear. (For investment, please search | Rong 360 |)
Private equity investment fund refers to private equity investment in unlisted enterprises, and investors share investment income and bear investment risks according to their share of capital contribution. In the process of transaction implementation, the future exit mechanism is considered, that is, through listing, mergers and acquisitions or management buyback. , profit from the sale of shares. However, at present, a small number of private equity funds invest in the shares of listed companies, and some also use debt-based investment, but the above accounts for only a small part.
Private equity funds mainly invest in mature enterprises that have formed a certain scale and generated stable cash flow, which is the biggest difference from venture capital funds. Private placement is relative to public offering. At present, all funds in China are raised through public offering, which is called fund public offering. If a fund does not go through public offering, but privately raises funds for a specific target, it is called a private equity fund.
There are two ways to raise funds, one is through equity, each fund holder is a shareholder of the fund, and the manager is also one of the shareholders. The other is contractual, and the relationship between the holder and the manager is contractual, not equity. At present, public offering funds are all contractual, but at present, China's laws only allow public offering funds to raise funds by contract. Therefore, if you want to set up a private equity fund, you must adopt the way of equity, so there is no legal obstacle.
Question 10: What is the difference between private equity investment and venture capital investment? The private equity fund industry originated from venture capital. In the early stage of development, small and medium-sized enterprises mainly started businesses and expanded financing, so venture capital became synonymous with private equity investment for a long time. Since 1980, the popularity of large M&A funds has given private equity funds a new meaning, and the main difference between them is in the investment field. The investment scope of venture capital fund is limited to the financing of small and medium-sized high-tech companies in the initial stage and expansion stage. Private equity funds mainly invest in mature enterprises that have formed a certain scale and generated stable cash flow, which is the biggest difference between them and venture capital funds.