1, which can reduce the financial cost;

2. Improve the intrinsic value of the enterprise;

3. Provide a stable source of funds.

The disadvantages of private equity investment income are:

1. After the enterprise transfers the equity, the original shareholder's equity is diluted, the shareholder relationship changes and the rights and obligations are readjusted;

2. With the change of ownership structure, the management right of the enterprise will also change accordingly, and the management right will be owned by the controlling shareholder after the equity transfer.

legal ground

According to Article 4 of the Interim Measures for the Supervision and Administration of Private Equity Funds, private equity fund managers and institutions engaged in private equity fund custody business, private equity fund sales business and other private equity service institutions engaged in private equity fund service activities should fulfill their duties and fulfill their obligations of honesty, credibility, prudence and diligence.

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