HUAZHANG TECH invested 95.69 million to participate in bankruptcy reorganization and will wholly own Baoshan Xinshi Tai Paper Industry
HUAZHANG TECH announced an investment of 95.69 million yuan to participate in the bankruptcy reorganization of Baoshan Xinshi Tai Paper Industry, becoming its wholly-owned subsidiary. According to the reorganization agreement, the investment will be used to pay off debts, which will improve the recovery rate of outstanding debts and achieve strategic integration and expansion. The board of directors believes that this move will optimize asset returns, enhance market competitiveness, and promote organic growth
According to the announcement from ZhiTong Finance APP, Huazhang Technology (01673) announced that on July 28, 2025, the manager Yunnan Hengjia Asset Liquidation Co., Ltd., Zhejiang Huazhang (a wholly-owned subsidiary of the company), and the debtor company Baoshan Xinshi Tai Paper Co., Ltd. entered into a reorganization agreement. According to the reorganization agreement, Zhejiang Huazhang has agreed to invest a total of RMB 95.6938 million into the debtor company, which will be used to repay the debts owed by the debtor company to its creditors as confirmed, reviewed, and verified by the manager in the reorganization plan.
Once all the preconditions are met, the manager will initiate the process of transferring all equity of the debtor company (including all its assets) to Zhejiang Huazhang according to the reorganization plan, and the transfer will be completed within 25 days after Zhejiang Huazhang fully pays the investment amount as per the reorganization agreement. Upon completion of the equity transfer, the debtor company will become a wholly-owned subsidiary of the company.
The announcement stated that by actively participating in the bankruptcy reorganization process of the debtor company and converting existing debts into equity, it can not only significantly improve the recovery rate of unpaid debts but also seize the opportunity for strategic industry integration and expansion.
Based on the above reasons, the board of directors believes that entering into the reorganization agreement optimizes the group's asset returns, strengthens its market competitiveness, creates synergies, promotes organic growth, and increases the chances of recovering bad debts
