Thu 10/22/2020 03:48 AM
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UPDATE 1: 3:48 a.m. ET 10/22/2020: A consortium led by Zhuhai Huafa Group and another consortium led by Taikang Life Insurance have been shortlisted to the final round of strategic investor selection in the consolidated bankruptcy filing restructuring of Peking University Founder Group and four other subsidiaries, the bankruptcy filing administrator said during the first creditors' meeting today (Oct. 22) according to sources. Continue reading for the Asia Core Credit by Reorg team's coverage of the Peking University Founder Group's bankruptcy filing, and request a trial to follow our coverage of thousands of other financial restructurings.

Zhuhai Huafa has teamed up with Ping An Insurance in the race, while Taikang Life Insurance is partnering with the Wuhan municipal government, according to the administrator.

The administrator is negotiating with the potential investors about transaction structure, debt repayment proposals and future operational plans, said the administrator during the meeting.

Judges from Beijing No.1 Intermediate People’s Court also appointed Bank of Beijing as president of the creditors’ meeting today.

The administrator has retained Huatai United Securities as restructuring financial advisor and Zhonghui Accounting as tax consultant. Ernst and Young Hua Ming and Pan-China Appraisal have been hired for auditing and assets appraisal.

The online meeting was held at 9:30 a.m. today Beijing Time on the National Enterprise Bankruptcy Information Disclosure Platform and was attended by judges from Beijing No.1 Intermediate People’s Court, vice president of People’s Bank of China Nanjing Branch Guo Dayong, representatives of auditor E&Y and legal advisor Dentons as well as legal representatives of Peking University Founder Group, Peking University Resources Group, Founder Industry Holdings, PKU Healthcare Industry Group and Peking University Founder Information Industry Group.

Debt Claims and Assets

As of Oct. 9, the administrator has confirmed a total of RMB 136.44 billion debt claims, including RMB 14.87 billion secured debt and RMB 121.57 billion unsecured debt, while it has rejected a total of RMB 67.512 billion debt claims, according to a document reviewed by Reorg.

A total of RMB 29.021 billion debt claims are pending recognition while RMB 26.512 billion of debt on the debtors’ books was not filed to the administrator, according to the document. Offshore creditors have filed RMB 21.802 billion debt claims, representing 9.43% of the total reported claims.

As reported, a total of 638 creditors had filed RMB 231.167 billion debt claims against PKU Founder Group, Peking University Resources Group, Founder Industry Holdings, PKU Healthcare Industry Group and Peking University Founder Information Industry Group.

According to the administrator during the meeting, the five entities in the consolidated bankruptcy proceedings had total assets of RMB 68.5 billion and total liabilities of RMB 145.5 billion as of Jan. 31. Net assets were negative RMB 77 billion. Total cash balance was RMB 1.78 billion, including RMB 1.525 billion restricted cash as of Jan. 31. Cash available for use was just RMB 143.06 million as of Oct. 10, excluding restricted cash and other funds with specified uses.

As of Jan. 31, receivables and financial assets accounted for three quarters of the total assets held by Peking University Founder Group, Peking University Resources Group, Founder Industry Holdings, PKU Healthcare Industry Group and Peking University Founder Information Industry Group, according to an asset management plan reviewed by Reorg.

Strategic Investors

The administrator said in the meeting today that it had received indications of interest from 29 potential strategic investors, of which 15 passed an initial screening. Six candidates were later shortlisted to the second round including state-owned Zhuhai Huafa Group, Taikang Insurance Group, Qingdao West Coast New Area Rongkong Group, Zhongze Group, Amer International Group and Beijing Financial Holdings Group.

The administrator had received investment proposals from four of the potential investors in the second round, including a consortium of Zhuhai Huafa and Ping An Insurance, a consortium of Taikang Life Insurance and the Wuhan government, a consortium of Zhongze Group and China Aoyuan Group, and Amer International, according to the administrator.

Creditor’s list is HERE. Asset management plan is HERE. Meeting agenda is HERE.

Below is the capital structure of PKU Founder:


Click HERE to enlarge

 




Original Story 10:48 p.m. UTC on Oct. 21, 2020

BREAKING: PKU Founder Administrator Shortlists Zhuhai Huafa, Taikang Life Insurance in Final Round of Strategic Investor Selection

The bankruptcy administrator of Peking University Founder Group said in the first creditors' meeting held today, Oct. 22, that it has shortlisted a consortium of Zhuhai Huafa Group and Ping An Insurance, and a consortium of Taikang Life Insurance and the Wuhan government in the final round of strategic investor selection.

More to come...
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