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A Study on SCP Research of Private Equity Fund in China
private equity fund,private placement,venture capital,china,LBO,industrial organizational theory,SCP,market structure,market conduct,market performance,
|Publication Year :||2008|
China is now the key focused area for the private equity funds around the world, along with China domestic funding, the competition from the global players is extremely violent in China arena. Starting from the point of view of industrial organization and facilitating the SCP analytical framework, this study intend to have a research and analysis toward the interactive relationships among the market structure, conduct, performance and regulation for the private equity activities in China.
The Chinese private equity industrial ecology has turning from the so called “two-end outside” meaning offshore funding and exit to “two-end inside” meaning onshore funding and exit. The change has made intentionally by Chinese Authorities under the guide-style open-door policy. Comparing to those developed countries, China is just entering this arena recently, therefore based on the nationalism and some other psychological consideration, the Chinese people is still needed to educate with those cutting-throat takeovers. While the experiences of local players are far behind the foreign players, thus the cultivation of local professional should be one the the most important and long term plans of private equity development for Chinese Authorities.
The market structure of private equity in China is highly competitive; due to the company scale in China is relatively small than those in developed countries, so that the market is conducting a much smaller investment scale on the average basis. Furthermore, because of the insufficient funding and inexperienced professionalism, China’s local private equity funds have much lower degree of product differentiation. However, the local players have their own competitive advantages, such as they do have better relations with China government and they got higher sensitivity toward the policy-making, both can result in fast response to any kind of policy change. Moreover, the local players enjoy higher recognition and share the same cultural background, thus they can be better trusted by the owners of China enterprises. This is why more and more foreign players plan to be localized by seeking the joint venture with local players, opening the offices in China and recruiting the Chinese professionals to be their eyes in China; Moreover, the market performance is much higher than those in developed countries, due to the booming of China stock market in recent years, the ultra high rewards induced global capital moves into China market.
By conducting the structural analysis of the development milestones and industrial structure for the private equity activities in China, hoping this study can be an appropriate reference to Taiwan’s regulators and private equity participants.
|Appears in Collections:||會計與管理決策組|
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