On February 27, 2023, Guangdong Provincial High People’s Court published their 15 bankruptcy typical cases. The bankruptcy restructuring of Shenzhen Hemei Group, for which JunHe acted as the administrator, was shortlisted. JunHe partners ZHANG, Jianwei, WU, Lei, YANG, Li and SHEN, Feng led the JunHe team in this Project, and partner SHEN, Feng primarily undertook the work.
In the pre-restructuring and restructuring of Hemei Group and its core subsidiaries, JunHe completed most of the pre-restructuring work. JunHe’s team ensured Hemei Group formulated a pre-reorganization plan through negotiations with its main creditors, investors, potential investors and other stakeholders, and assisted the company to introduce restructuring investors, which set a solid foundation for the formal reorganization. After Shenzhen Intermediate People’s Court ruled to accept the case, and after 32 days of hard work by the administrators and all parties, the reorganization of Hemei Group and its subsidiaries was finally successful. A collaborative restructuring method was adopted to formulate the overall restructuring plan for the parent company and its subsidiaries according to the operation mode, business relationship, debt correlation and the other characteristics of the affiliated companies. This gave full play to the advantages of the three companies, restored the overall profitability of the company and solved the debt crisis of the group and the companies in each core business segment. The plan protected the rights and interests of the creditors to the maximum extent and achieved a win-win result.
As stated by Guangdong High People’s Court, the restructuring of Hemei Group was a typical case for the successful restructuring of a listed company by using the advantages of a pre-restructuring system. Hemei Group and its two affiliates coordinated with each other in the trial and successfully resolved credits, debts and a long-pending case. It relocated over 100 employees, and effectively resolved the debt crisis and operating predicament of Hemei Group. It avoided the delisting risk and protected the interests of most small and medium-sized shareholders and creditors. The restructuring enriched the reorganization practice for listed companies and provides a template for the improvement of other pre-reorganization systems.