Abstract:

Although decreasing the proportion of state - owned shares is a basic policy, the issue of how to operate efficiently is still worth inquiring into. There are two ways as to the problem. One is to decrease the proportion step by step, and the other is to accomplish the decrease just in one step. From the angle of the market for corporate control we find that the second way is more efficient since it can improve the corporate value to the full.

Key words: the market for corporate control, corporate value, decrease of holdings of state -owned shares