What is financing, what is holding and what is equity issuance?

1. In a narrow sense, financing is the behavior and process for enterprises to raise funds. That is, according to the company's own production and operation, capital ownership and the needs of the company's future operation and development, through scientific prediction and decision-making, the company adopts certain methods to raise funds from the company's investors and creditors and organize the supply of funds to ensure the company's normal production needs and financial management activities. The motivation of the company to raise funds should follow certain principles and be carried out through certain channels and ways. Generally speaking, enterprise financing has three purposes: want to expand, want to pay off debts, and have mixed motives. Broadly speaking, financing is also called finance, that is, the financing of monetary funds and the behavior of the parties to raise or lend funds in the financial market in various ways.

Financing can be divided into direct financing and indirect financing. Direct financing is a financing activity conducted directly by the government, enterprises, institutions and individuals as lenders of last resort, without the intermediary of financial institutions. The financing funds are directly used for production, investment and consumption. Indirect financing is a financing activity from the last borrower to the last lender with financial institutions as the medium, such as corporate financing banks and trust companies.

2. Holding means that an individual or company holding a large number of shares of the company has the control and decision-making power of the company.

3. Non-public offering is issued to specific investors, also called private placement, which is actually a common overseas private placement.

1] Additional issuance, rights issue and bond issue of listed companies all belong to the category of refinancing concept.

[2] issuance: refers to the behavior of listed companies to issue shares again for refinancing.

[3] Private placement: It is a form of private placement. It means that when a listed company issues shares, the issuing target is a specific investor (it cannot be bought with money).

The biggest advantage of non-public offering is that large shareholders and powerful investors with strong risk tolerance can transfer funds to listed companies at prices close to or even exceeding the market price, thus minimizing the investment risks of minority shareholders. Because the largest 10 investor who participates in the orientation has a clear lock-up period, generally speaking, listed companies that dare to propose a non-public offering plan and have been accepted by large investors will usually have better growth.

Private placement plays a significant role in improving corporate profitability and corporate governance. Only by looking for more companies with the possibility of private placement and carefully analyzing the relevant schemes and motives can we have the opportunity to explore new investment themes in the era of full circulation.