MBO (ManagementBuy-Outs) that Economists to the definition of MBO is that the target company's managers and managers use the financing to buy shares of the company to achieve the company's ownership structure, control structure and asset structure changes, business owners and managers to achieve the identity of one who led reorganization of the company, and then get an expected return of property rights acquisitions.
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MBO
is defined as the target company's managers and managers use the financing to buy shares of the company to achieve the company's ownership structure, control structure and asset structure changes implementation managers to owners and operators as one of the leading restructure the company, and then get an expected return of property rights acquisitions. Since the acquisition of encouraging internal personnel management initiative, reduce agency costs and improve business conditions has played a positive role, and thus it became popular in 20th century Europe and the United States 70-80 years of a business acquisitions. Chinese enterprises, MBO can sort out the greatest charm of enterprise property rights, to achieve the owner of return, the establishment of corporate long-term incentive mechanism, which is the most salient characteristics of China's MBO. From the current point of view, the domestic role of specific performance of the MBO in four aspects: First, state-owned enterprises, to the real owners of enterprises operator's management, reduce agency costs. Thus, MBO has been given high expectations, however, the practice from home and abroad can be seen MBO, MBO is not suitable for all enterprises. Implementation of the MBO of the business have at least three conditions; First, efficiency of the management company to have a certain space; Secondly, a strong business in the competitive industries, such as home appliances and some high-tech companies with good growth; The third point is companies have excellent management team, which is the key to the success of MBO. Management Buyout MBO content developed countries in the securities market has all the rage, in foreign countries more than 20 years of history, but in China, MBO trial in recent years and gradually began to rise. MBO in the clear property rights, can strengthen the incentive, business management, especially for managers have a positive effect, so more and more companies ready to proceed to the implementation of MBO, our experts will be more as a MBO in 2003. At present, China has Yutong Bus, Guangdong Midea, a large square in Shenzhen, and other listed companies experimented Fosugufen MBO program.
MBO
MBO launched in the West the main motivation is to solve issues such as agency cost managers, intended to address the company's ownership structure, control structure and corporate capital structure. The system of property rights in China is different from the Western system of property rights, which determine the motivation of China and characteristics of MBO decisively different from the West. At the same time, MBO is the rise in the West because it can improve the comprehensive application of the results of financing tools, and China's securities market is still a lack of effective financing tool, at this stage in China and abroad MBO MBO operations must have a significantly different operating characteristics. This article attempts to combine the actual situation of China's enterprises to analyze the MBO theory and operational practice, trying to interpret the localization of MBO programs for companies interested in MBO hope to benefit from. Management buyouts, also known as managers or management level by borrowings or equity financing transaction of the acquisition of shares in the Company's behavior in order to change the company ownership structure, control structure and asset structure, thus achieving the purpose of restructuring the company and obtain an expected return acquisitions, the seventies of the twentieth century in the traditional M & A theory developed on the basis of a new type of mergers and acquisitions, the enterprise value of great importance to improve the management of human capital an incentive model. Through the acquisition, the business became a business owner who completed the simple business managers to change corporate masters. The implementation of MBO, which means the value of management's recognition as a resource. Typically, management and staff of listed companies jointly invested in employee stock ownership or management of listed companies will set up a new company funded the acquisition of subject, one or more held by the transferee of the original shareholders owned shares of listed companies, which directly or indirectly controlling shareholders of listed companies.
MBO
MBO management through the design of both business owners and business operators is the special status of self-management of enterprises in the hope that incentives, as well as external constraints high debt fully tap the business potential and achieve maximization of corporate value. In other words, MBO of the most important goal is to return. MBO basic starting point is the internal incentive mechanism to solve problems, reduce business between the owners and operators of the agency costs. Resolve internal motivation to reduce agency costs there are many kinds of ways,
nike air force one high, and MBO is the most direct way. At present, China's capital market has been exploring ways to resolve state-owned shares, MBO in China is a new thing the past two years there. And frankly, in our current lack of state-owned enterprises are facing internal and distorted incentives, the management buyout of part of the solution inevitably insufficient incentives for state-owned enterprises an option. Economic reform in China environment,
air force one high, may be more effective. According to the different assets acquired company structure, management intends to purchase the layer, and the original shareholders of the acquired company will transfer, MBO's operations are mainly the following modes: a. the acquisition of the shareholders of the company management level management level of the acquisition of the parent company b. c. management layer, a subsidiary of the parent company acquired business units under the management level d. The first advantage of the acquisition of the parent company to avoid the laws of many sources of special restrictions on the stock, so holding the smooth implementation of the program; MBO
Second, management and other employees to subscribe for shares at their own expense, both to ensure that incentives can ensure that the constraint; the third, the transfer of corporate shares, relatively low cost; Fourth, the agreement for transfer price is higher than the net assets per share, easy access to state-owned assets management department's permission. There are usually state-owned veterans shortcomings of state property into private property of the suspect; state-owned enterprises to implement MBO, if unregulated will of state assets. Features 1, competitive industries. In essence, MBO process of privatization of enterprises, is also based on this, for a monopoly and resource industries,
MBO
such as telecommunications, energy, transportation, does not apply to MBO, because these industries people's livelihood, the relationship between a region and the country's economic lifeline, can not be placed under the control of a few palm. In contrast, competitive industries is more suitable for the application of MBO, as one of its operators and owners of properties that reduce agency costs, market reaction and decision speed, so that the enterprises more easily in the fierce market competition. The 2, the major shareholder support. Management buy shares in the services business, the transferor company is generally the major shareholder of the original, so the support of major shareholders as a prerequisite the successful operation of MBO, particularly when related to the acquisition of state-owned shares, this support even more critical. In contrast, if the management of the takeover is not supported, will directly increase the cost of acquisition, delaying the acquisition process, and the MBO of the business after a shadow. 3, contribute to the development of enterprise management. In the MBO practice, very few third-party bid for the management and the phenomenon, this much is because the transferor has reached a tacit understanding with management in advance, and this understanding is based on the management of enterprise development over the years to make a great contribution. Many enterprises in the natural course of development of the formation of a To ensure continuous and stable business, in the equity management as a priority when the transfer of the transferee and the transfer price is also more or less reflects past performance and contribution to management recognition. 4, operating cash flow stability. LBO MBO as a class, meaning that management needs to rely on borrowing means the acquisition of most of the money raised, which means long time after the MBO, management needs to shoulder a greater pressure on debt service . This requires that the subject of MBO or management company to take control of the other economic resources in the debt service provided during the relatively stable cash flow to ensure the smooth acquisition of funds to pay. We emphasize the In addition to the above, MBO companies assess their feasibility, you also need to consider spending the next few years the pressure of capital, financial leverage, the operation of the space, and the possibility to further improve management efficiency. After considering all factors, companies need to design their own actual situation of the implementation of the MBO program, personalized programs and implementation of the detailed aspects of the success of the MBO is more critical.
MBO
MBO is the state-owned enterprises in China since the 90s of last century from the introduction of a reform of property rights to explore ways. But almost from the date of implementation, some economists have never stopped on the question this way. Some experts believe that the investor in the supervisory role of state-owned assets, the case has not yet in place, large-scale implementation of the management shares five easy to enterprises risks: First, links in the pricing of risk, such as administrative intervention, such as the transfer agreement; Second, asymmetric information, the risk of secret operations, for example, do first loss of the company and then bought cheap; third person financing the acquisition of unknown risk; Fourth, operational risks; five can not guarantee the legality of the acquisition of the main risks. So it should be stopped immediately. MBO in China state-owned enterprises reform of property rights was questioned for several reasons: First, MBO in a foreign country not by much use, such as in the U.S. only 1% of companies implemented the MBO, and some domestic scholars in the MBO is not very understanding, strongly advocated In this way; Second, MBO into MBI; again, the local government to do business on certain conditions, according to the procedures of state-owned nuclear assets are not price, nor the introduction of a fair bidding mechanism cheap to sell state-owned enterprises to private. In Western countries, the stock is tradable and can be recovered on the open market premium. MBO is now our money, the bank acquired the assets of countries, this practice is very different and foreign. Moreover, China's state-owned shares of listed companies is not full circulation. True sense of the MBO should be the acquisition of outstanding shares in premium, which Management Buy Out (MBO), the domestic approach is not the acquisition of state-owned shares in circulation, has become MBI (Management Buy In), and it also set their own prices, such MBO likely to be looted state assets as a way to use the most convenient. A typical case of MBO: Sina Management MBO: China's Internet industry's first MBO. Background: September 28, 2009, SINA announced that the Sina Sina CEO Charles Chao led the management, will be about 1.8 billion dollars in price, the purchase of approximately 560 million common shares of Sina, becoming the largest shareholder of Sina. This will become the first Chinese Internet industry, MBO (ManagementBuy-Outs or MBO level of management through the design of both business owners and management is the business's special status, hope of self-enterprise incentive management, and high debt external constraints to fully tap the business potential and maximize enterprise value. In other words, MBO of the most important goal is to return.
MBO
MBO basic starting point is to solve the problem of incentive mechanism within the enterprise, reducing business between the owners and operators of the agency costs. Resolve internal motivation to reduce agency costs there are many kinds of ways, and MBO is the most direct way. At present, China's capital market has been exploring ways to resolve state-owned shares,
air force one shoes, MBO in China is a new thing the past two years there. And frankly, in the current Chinese state-owned enterprises face insufficient incentives and distortions in the internal situation, management buyouts inevitably be insufficient incentives for state-owned enterprises to solve an option. Economic reform in China, environment, might be more effective. According to the different assets acquired company structure, management intends to purchase the layer, and the original shareholders of the acquired company will transfer, MBO's operations are mainly the following modes: 1, the acquisition of the shareholders of the company operating level 2, the acquisition of parent company management level , a subsidiary of 3, the acquisition of the parent company operating under the layer of business 4 business layer MBO acquisition of the parent companies choose M & A as a new technology is not applicable to all types of enterprises. In practice, the enterprise needs to consider its own industry attributes, history, current situation and market prospects and other factors, a comprehensive assessment of the feasibility of the acquisition to ensure the smooth progress of the acquisition and successful operation of the enterprise after the acquisition. Successful implementation of the MBO of the business has the following characteristics: 1, competitive industry. In essence, MBO process of privatization of enterprises, is also based on this, for a monopoly and resource industries such as telecommunications, energy, transportation, does not apply to MBO, because these industries the people's livelihood, the relationship between a region and country's economic lifeline, can not be placed under the control of a few palm. In contrast, competitive industries is more suitable for the application of MBO, as one of its operators and owners of properties that reduce agency costs, market reaction and decision speed, so that the enterprises more easily in the fierce market competition. The 2, the major shareholder support. Management buy shares in the services business, the transferor company is generally the major shareholder of the original, so the support of major shareholders as a prerequisite the successful operation of MBO, particularly when related to the acquisition of state-owned shares, this support even more critical. In contrast, if the management of the takeover is not supported, will directly increase the cost of acquisition, delaying the acquisition process, and the MBO of the business after a shadow. 3, contribute to the development of enterprise management. In the MBO practice, very few third-party bid for the management and the phenomenon, this much is because the transferor has reached a tacit understanding with management in advance, and this understanding is based on the management of enterprise development over the years to make a great contribution. Many enterprises in the natural course of development of the formation of a To ensure continuous and stable business, in the equity management as a priority when the transfer of the transferee and the transfer price is also more or less reflects past performance and contribution to management recognition. 4, operating cash flow stability. LBO MBO as a class, meaning that management needs to rely on borrowing means the acquisition of most of the money raised, which means long time after the MBO, management needs to shoulder a greater pressure on debt service . This requires that the subject of MBO or management company to take control of the other economic resources in the debt service provided during the relatively stable cash flow to ensure the smooth acquisition of funds to pay. Emphasis on In addition to the above, MBO companies assess their feasibility, you also need to consider spending the next few years the pressure of capital, financial leverage, the operation of the space, and the possibility to further improve management efficiency. After considering all factors, companies need to design their own actual situation of the implementation of the MBO program,
air force one low, personalized programs and implementation of the detailed aspects of the success of the MBO is more critical. MBO market in China is state-owned enterprises in China since the 90s of last century from the introduction of a reform of property rights to explore ways. But almost from the date of implementation, some economists have never stopped on the question this way. Some experts believe that the investor in the supervisory role of state-owned assets, the case has not yet in place, large-scale implementation of the management shares five easy risk to the enterprise: First, the pricing part of the risk, such as administrative intervention, such as the transfer agreement; Second, asymmetric information, the risk of secret operations, for example, do first loss of the company and then bought cheap; third person financing the acquisition of unknown risk; Fourth, operational risks; five can not guarantee the legality of the acquisition of the main risks. So it should be stopped immediately. MBO in China state-owned enterprises reform of property rights was questioned for several reasons: First, MBO in a foreign country not by much use, such as in the U.S. only 1% of companies implemented the MBO, and some domestic scholars in the MBO is not very understanding, strongly advocated In this way; Second, MBO into MBI; again, the local government to do business on certain conditions, according to the procedures of state-owned nuclear assets are not price, nor the introduction of a fair bidding mechanism cheap to sell state-owned enterprises to private. In Western countries, the stock is tradable and can be recovered on the open market premium. MBO is now our money, the bank acquired the assets of countries, this practice is very different and foreign. Moreover, China's state-owned shares of listed companies is not full circulation. True sense of the MBO should be the acquisition of outstanding shares of a premium, that is ManagementBuyOut (MBO), the domestic approach is not the acquisition of state-owned shares in circulation, has become MBI (ManagementBuyIn), and it also set their own prices, such MBO is likely to be plundering of state assets as a way to use the most convenient. Management by objectives management by objectives (MBO) in the period of time (normally one year) activities of the organization expected results, is the organization's specific mission in a given period, is a measure of the effectiveness of the standard organizational activities. Activities of the organizational activities of individual organic stack, so only the individual employees, the work of various departments to make the expected contribution to organizational activities, is possible to achieve organizational goals. So, how to make all employees, active in all sectors to find ways for the organization's overall goal is to key to the effectiveness of management activities. Target management is a concrete way to solve this problem. First, the meaning of management by objectives . Drucker believes that there is not the only goal of the work, but on the contrary, with the objective to determine each person's work. Therefore, the Therefore, managers should be managed at lower levels through the target, when the organization's most senior managers to determine the organizational objectives and must be effectively decomposed into various sub-sectors, as well as personal goals, managers based on the completion of sub-objectives lower the assessment, evaluation and reward and punishment. Management of future goals, it quickly spread in the United States. A time when Western economies after World War II shifted from the restoration period of rapid development, companies need new ways to mobilize the enthusiasm of employees to improve competitiveness, the emergence of management by objectives can be described as emerged, then was widely and quickly as Japan, Western Europe's companies to follow suit, popular in the world management sector. A variety of specific forms of management by objectives, but its basic content is the same. The so-called management by objectives or process but a process that enables the organization in consultation with superiors and subordinates, the mission of the organization determine the overall objective of the organization during a given period, which determines the lower levels of responsibilities and targets,
nike air force 1 high, and these as the organizational and operational goals, assess and reward the contribution of each unit and individual standards. Second, the basic process management by objectives management by objectives of the specific approach in three phases: the first phase of the target set; second stage of the process to achieve the objectives of management; the third phase for the determination and evaluation of the results achieved. 1. Setting goals is the most important stage management by objectives, the first phase can be subdivided into four steps: ① target senior management, this is a temporary, can change the target plan. That can be raised higher, and then discuss with the lower level; also be made by the lower level, the higher authorities. Either way, must work together to discuss the decision; Second, leadership must be based on the mission and long-term business strategy, the objective environment is estimated that the opportunities and challenges, the merits of the company have a clear understanding. The organization should be able to accomplish a pretty good idea. ② to reconsider the organizational structure and division of responsibilities. Target management requirements are identified for each sub-goal of the main responsibilities. Therefore, the intended target, the need to re-examine the current organizational structure, according to the requirements of the new goals down to adjust, clear objectives and coordination between those responsible. ③ set lower goals. First of all subordinate organizations in the planning and clear objectives, and then agreed to lower the sub-goals. In the discussion, respect for superiors to subordinates, equals, patience to listen to lower level views to help develop consistency and support of the lower targets. Specific quantitative targets to facilitate assessment; prioritize in order to avoid trade-off; it is necessary to challenge, but also have realized possible. Each employee and department targets and other targets to be coordinated in support of the unit and organizational goals. ④ superiors and subordinates to achieve the conditions necessary for the objectives and goals to reach an agreement after the incentive. Targets after the enactment of lower levels to grant the power of the corresponding allocation of resources, powers and responsibilities to achieve the unity of interests. Written by a subordinate written agreement, the preparation of target record card, all the information aggregated across the organization to draw the target figure. 2. Process management goals management by objectives focus on results, emphasizing independence, autonomy and self. Does not mean that leadership can be let go regardless of the contrary, due to the formation of the target system, a ring failure, it will affect the overall situation. Therefore, the process of leadership in the management of targets is essential. First, regular inspection, the use of regular contact with both the opportunities and information feedback channel the natural manner; followed the progress notification to the lower level, to facilitate co-ordination; once again work to help lower levels of difficulties to solve the problem, when unexpected, unpredictable episodes influence organizational goal is achieved, the procedure can also be, modify the original target. 3. Summary and evaluation to achieve predetermined period, the lower the first self-evaluation, submit a written report; and then on completion of assessment objectives with subordinates, decided to reward and punishment; also discuss the next phase, to start a new cycle. If the target is not completed, should analyze the reasons for lessons learned,
nike air force one low, should not blame each other, in order to maintain an atmosphere of mutual trust. Third, the analysis of the target management system of management by objectives have a significant impact in the world, but many problems have also emerged in the implementation. Must objectively analyze the advantages and disadvantages in order to avoid weaknesses and effectively. 1. ① advantage of management by objectives management by objectives of the organization's objectives easy to measure and decomposition will bring a good performance. For those technically the work of separability, because the responsibility, tasks, target management is often clear the immediate effect will play, but can not be separated for the technical team (TNE) is difficult to implement management by objectives. ② target management help to improve the organizational structure of the division of responsibilities. As the outcome of organizational goals and responsibilities assigned to a position or department trying to, easy to find under-licensing and other defects is unclear. ③ target management consciously inspired, mobilized workers initiative, enthusiasm and creativity. The emphasis on self-control, self-regulation, personal interests and organizational interests of the closely linked, thus increasing morale. ④ target management to promote the exchange of ideas and mutual understanding and improved relationships. 2. The shortcomings of management by objectives in practice, there are many obvious target management shortcomings, mainly in: ① target is difficult to develop. Many of the goals within the organization is difficult to quantify, concrete; a lot of team work is technically unsolvable; organizational environment variables that more and more, faster and faster change, increasing complexity of the organization's internal activities, so that the uncertainty of organizational activities increasingly large. Many of these activities which makes the number of organizations, the goal is very difficult. ② philosophical assumptions of management by objectives may not exist. Y theory of human motivation made overly optimistic assumptions, practice is the So many cases, the target management requires commitment, consciousness, autonomy is difficult to form the atmosphere. ③ target agreed management costs may increase. Target agreed to the upper and lower communication, unity of thinking is very time-consuming; each unit and individual attention to their own goals to complete, is likely to ignore the mutual cooperation and the goals of the organization, breed selfishness, temporary and immediate tendency to view. ④ can sometimes reward and intended results are not necessarily compatible, it is difficult to ensure fairness, thus weakening the effect of management by objectives. Given the above analysis, in practice the implementation of management by objectives, in addition to other specific methods to master, but also special attention to grasp the nature of the work, analyze its possible decomposition and quantified; improve ethical standards of employees, training the spirit of cooperation, establish and improve the rules and regulations, pay attention to improve leadership style and working methods to make the implementation of management by objectives based on some ideological basis and the basis of scientific management; to be gradually introduced, long-standing, continuous improvement, so that the goal of management is expected to play a role. Atlas Atlas entry for more extended reading: 1
Ying Teng , finance, organizational behavior, equity incentive, to improve the management of listed my
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