DEALS
Zhong Lun Advised Ping An and Other Investors in Successful Reorganization of PKU Founder Group
Zhong Lun Advised Ping An and Other Investors in Successful Reorganization of PKU Founder Group
On June 28, 2021, the Beijing First Intermediate People’s Court ruled to approve the reorganization plan of Peking University Founder Group Co., Ltd. (“PKU Founder Group") and its four subsidiaries, marking the success of PKU Founder Group’s bankruptcy reorganization. Zhong Lun advised the joint investment body consists of Ping An Insurance (Group) Company of China, Ltd., Zhuhai Huafa Group Co., Ltd. (being representative of Zhuhai State-owned Assets Supervision and Administration Commission) and Shenzhen SDG Group Co., Ltd., who won out of 29 competitors and successfully reorganized PKU Founder Group, setting a new benchmark for China’s university-run enterprise reform.
PKU Founder Group has developed into a conglomerate across many business sectors including information industry, medical care, real estate, commerce, education and finance, and has nearly 400 affiliated and associated companies and institutions including 6 listed companies (4 A-share listed companies and 2 H-share listed companies) with consolidated assets over RMB 300 billion and debts nearly RMB 200 billion. The large amount of assets and debts as well as the wide range of business scope make it a rare case in China’s reorganization practice. This case involves many cutting-edge issues in current bankruptcy reorganization practice such as substantive consolidation in reorganization, change of actual controllers of listed companies/financial institutions, extraterritorial effects of reorganization, etc. It is currently one of the most complex and influential bankruptcy reorganization cases nationwide.
Zhong Lun provided legal services throughout the whole process of reorganization and investment including conducting due diligence, designing investment plan, negotiating, revising and finalizing investment agreements and reorganization plan, assisting in post-investment industry integration, formulating risk control plan, etc. Zhong Lun assisted the investors in precisely developing tactics and taking actions and in tailoring a targeted reorganization plan for PKU Founder Group, which not only preserves the overall operation value of PKU Founder Group to the greatest extent and maximizes the value of its assets, but also effectively controls the potential/contingent risks, taking into account the investors’ investment objectives and risk control requirements. The reorganization plan has achieved a real win-win result for the investors and the creditors and has been widely recognized and praised by the market.
This project is led by Zhong Lun partner Zhang Decai as general leader, and partner Wang Bing as site leader. The team members include associates Pu Junlin, Zhang Beibei, Luo Xi, Wang Chonglin, Zeng Yujian, Zhao Yijing, etc.
