Date, Shenyang Intermediate People's Court of Liaoning Province announced: It ruled that Xinglong Dajiating (Xinglong Dajiating Commercial Group Co., Ltd.) has gone bankrupt. This means that Xinglong Dajiating's restructuring plan, which had been ongoing for years, ended in failure.

Once thought of as a quick knife cutting through tangled hemp, Xinglong Dajiating was once known as "Liaoning's largest private commercial group" and "a regional leader in China's retail industry." It owned shopping malls, supermarkets, hotels, and other industrial companies across cities in Liaoning and Heilongjiang provinces, with a commercial operating area of over 1 million square meters. Around 2010, Xinglong Dajiating began to face financial crises. Some analyses suggest that Xinglong Dajiating succeeded and failed due to the same factors. Its actual controller, who created the glory of Xinglong Dajiating, also became intoxicated with that glory, stubbornly sticking to one path. At a critical juncture when the overall retail environment underwent significant changes, Xinglong Dajiating not only failed to adapt in time but also continued to heavily borrow to build commercial real estate and expand its territory, ultimately leading to an irreversible situation.

Starting from the beginning of the year, various enterprises within the Xinglong Department Store Group began to file for bankruptcy reorganization one after another. On a certain date, the Shenyang Intermediate People's Court ruled to conduct a substantive consolidated reorganization of several enterprises within the Xinglong Department Store Group. However, the vote on the previously concluded "Reorganization Plan (Draft)" actually did not pass. Among them, one group voted in favor, but there was a split in another group—the prepaid card creditor group. A total of 100 companies/individuals attended the meeting, with 58 companies/individuals voting in favor, accounting for 58% of the attendees in this group and 58% of the total creditor amount in this group. Although more than half of the attending creditors agreed to the "Reorganization Plan (Draft)," the creditor amount they represented did not reach two-thirds of the total creditor amount in this group, so the vote in this group did not pass.

From the voting results, it is evident that some creditors holding large-value prepaid cards from Xinglong do not accept the Draft Restructuring Plan. This is not difficult to understand. According to the Draft Restructuring Plan, certain debts are prioritized for protection, such as employee debts, tax debts, and debts below 10,000 yuan, which are to be fully repaid at 100%. For debts exceeding 10,000 yuan, the repayment will be calculated based on the final repayment results—the estimated repayment rate is around %. The restructuring administrator specifically reminds that if the Draft Restructuring Plan is not approved and the company goes bankrupt, the repayment rate could be as low as 0.5%. For prepaid card debts, the Draft Restructuring Plan provides a repayment method where more than 50% of the value can be redeemed for in-store consumption. The restructuring administrator also emphasizes that if the Draft Restructuring Plan is not approved and the company goes bankrupt, the stores will close, and the prepaid cards will become unusable (void). In other words, prepaid card creditors can either accept the minimum 50% in-store redemption or choose to have their cards voided.

For small-value prepaid card creditors, many people think, "Take what you can get, it's not much money, and it can be barely accepted," but for some large-value prepaid card creditors, the % redemption ratio, and even consumption redemption, is almost like throwing money away. Therefore, some creditors have shown an attitude of "let's die together," and will never vote in favor. However, this almost singular point of voting divergence (involving a small number of opponents, just a small group within a larger group, and less than % of that group) is not enough to prevent the court from approving the "Reorganization Plan (Draft)."

Still not enough money has been gathered. However, the crux of the implementation of the "Restructuring Plan (Draft)" lies here: whether the restructuring plan can attract sufficient funds. Only when enough money is raised and debts can be repaid according to the plan can Xinglong Department Store Group operate normally; if not, everything is just a pie in the sky. The problem is that the court's ruling to execute the "Restructuring Plan (Draft)" coincided with the pandemic, and it wasn't until a year later (month and day) that a full lifting of restrictions occurred. During this period, it was one of the most difficult times for industries such as shopping malls and hotels, making it challenging to attract investment. Additionally, involving multiple enterprises across different regions increased the complexity, and the original plan to handle assets in three phases across various cities had its final timeline repeatedly pushed back. As of month and day, Shenyang and Dalian regions had realized a total of . billion yuan; investors in Benxi, Jinzhou, and Chaoyang regions had paid earnest money/deposit totaling . million yuan (potential investors)… still falling short of the realization target. Not enough money was gathered! Therefore, the final deadline for asset realization was extended to month and day, meaning each region had to complete its % asset realization target by this time. Unfortunately, this target was still not achieved. On month and day, the Shenyang Intermediate People's Court ruled that Xinglong Department Store Group was bankrupt. Evidently, all parties had prepared for the outcome of not gathering enough money.

Xinglong Family, the assets that can be used for recovery, include equity and debt, among others. For instance, on a certain date, the announcement by Xin Xinglong Commercial Management (Liaoning) Group Co., Ltd. titled "Public Recruitment for the Transfer of 100% Equity of Xin Xinglong Commercial Management (Shenyang) Co., Ltd. and Other Companies" involved the transfer and disposal of equity, corresponding to the property rights and operational rights of the relevant enterprises. On another date, the announcement by China Great Wall Asset Management Co., Ltd. titled "Liaoning Branch's Disposal Announcement of Debt for Shenyang Xinglong Family Shopping Center Co., Ltd. and Other Entities" involved the disposal of debt, with the underlying assets being commercial real estate of Xinglong Family. It seems that both the remaining business opportunities left by Xinglong Family and the large commercial real estate are somewhat problematic, making it difficult to find funds to take over.

It's not easy for state-owned assets to step in and stabilize the market. From another perspective, due to the involvement of the retail industry in people's livelihood, state-owned assets have made various efforts in the restructuring of Xinglong Dajiating, managing to salvage some of the situation. For instance, in [month], Shenyang Shengjing Department Store Management (Group) Co., Ltd. (controlled by the Shenyang State-owned Assets Supervision and Administration Commission) acquired a 100% stake in Xinglong Dajiating Commercial Group Co., Ltd. for 2.6 billion yuan, with Li Weilong, the actual controller of Xinglong Dajiating, stepping down. Subsequently, several malls that were originally part of Shenyang Xinglong Dajiating were renamed as Shengjing Da'aola, Shengjing Dajiating, Shengjing City Shopping Plaza, Shengjing Dadongcheng, and Shengjing Department Store Xinmin Branch, among others. Prepaid cards originally issued by Xinglong Dajiating can now be used at Shengjing-related stores at a certain ratio. This provides card-holding creditors with a relatively favorable channel for redemption.

Shenyang Shengjing Department Store Management (Group) Co., Ltd. has released promotional screenshots (with addresses blurred) indicating that it accepts certain portions of the original Xinglong Cards. Public information shows that after acquiring Xinglong Dajiating, Shengjing Department Store has been re-arranging its new retail landscape in Shenyang, expanding into a new "culture, commerce, tourism" format, while also withdrawing from a series of external investment enterprises. Correspondingly, other funds have taken over related companies. In [month], Jianxin Trust Co., Ltd. (backed by China Construction Bank and Central Huijin) fully controlled Xinxinglong Commercial Management (Liaoning) Group Co., Ltd. According to Enterprise Early Warning, Jianxin Trust, through Xinxinglong Commercial Management (Liaoning) Group Co., Ltd., has directly invested in 100 Xinglong Dajiating enterprises, with actual paid-in capital of approximately 1.2 billion yuan; indirectly invested in 100 Xinglong Dajiating enterprises since 2019, involving actual paid-in capital of approximately 10 billion yuan.

From the efforts of state-owned funds to stabilize the market, it can be inferred that all parties involved are expecting a relatively favorable outcome for the restructuring of Xinglong Department Store. Under the leadership of state-owned capital, more financial forces are expected to join the restructuring efforts. However, in reality, this favorable scenario has not been achieved. Entering bankruptcy liquidation, the existing assets of Xinglong Department Store are bound to experience the highest depreciation. As a once leading enterprise in Liaoning Province, the cost of its operational shift has indeed been too high.