N-Securities Reorganization Completed

2022-05-09

The market-oriented bankruptcy reorganization case of N-Securities Co., Ltd., the first of its kind for Chinese securities companies, was successfully concluded. 

On February 16, 2022, the Second Creditors’ Meeting of the Bankruptcy Reorganization of N-Securities was convened. DeHeng’s Beijing Office and Grandall Law Firm (Beijing), as the administrators of N-Securities, submitted the Draft Reorganization Plan of N-Securities to the creditors’ meeting for voting. As of the expiration of the voting period, the draft of the N-Securities Reorganization Plan was voted by the creditors and passed by the voting groups with a high margin.

On April 29, 2022, the China Securities Regulatory Commission issued the Reply on Approving the Change of Major Shareholders of N-Securities, approving Beijing Compass Technology Development Co., Ltd. as the major shareholder of N-Securities. On the same day, Shenyang Intermediate People’s Court made a civil decision (2021, L.01 P. 16-2), ruling to approve the N-Securities Reorganization Plan and terminate its reorganization procedure.

According to the plan, Compass will invest RMB 1.5 billion in N-Securities to pay off debts. After the reorganization, N-Securities unloaded a debt burden of nearly RMB 5 billion, eliminated major systematic financial risks, and welcomed Compass onboard as its shareholder. 

After DeHeng's Beijing Office and Grandall Law Firm (Beijing) were designated by Shenyang Intermediate Court as the administrators of N-Securities, they immediately set up an administrator team with DeHeng’s Shenyang Office and Tongwen Law Firm in Liaoning, as required.

The DeHeng team was led by Li Zhe, a partner of DeHeng's Beijing Office, with primary support from lawyers Huang Xiaohang, Lei Dan, Wang Qi, Wang Jichao and Zhang Tingting from DeHeng's Shenyang Office. This was another landmark bankruptcy reorganization case represented by partner Li Zhe after the main business bankruptcy reorganization deal of HNA Group.