On December 26, 2023, the Shanghai Third Intermediate People’s Court confirmed that the restructuring of Shanghai Trendzone Holdings Group Co., Ltd. (“Trendzone Holdings” stock code: 603030.SH) was complete. Fangda Partners had acted as the interim administrator during the pre-restructuring phase and as the administrator during the restructuring phase.

The Trendzone Holdings’ restructuring is notable for being the first restructuring of a convertible corporate bond issuer listed on the Shanghai Stock Exchange and the first pre-restructuring to restructuring of a listed company in Shanghai.

Trendzone Holdings, a Shanghai-based listed company, was founded on October 14, 1998, and listed on the Shanghai Stock Exchange in 2015. Later, it faced severe liquidity problems brought on by the pandemic and by debt issues with China Evergrande Group and its affiliates. These liquidity problems lead to numerous legal disputes and operational challenges.

To address these liquidity problems, the Shanghai Third Intermediate People’s Court accepted the pre-restructuring case of Trendzone Holdings on May 19, 2023, appointing Fangda Partners as the temporary administrator during the pre-restructuring period. As a SSE-listed company, Trendzone Holdings’ pre-restructuring and restructuring process received significant attention and strong support from government authorities, courts and relevant national departments at all levels. The Shanghai Third Intermediate People’s Court officially accepted the restructuring of Trendzone Holdings and appointed Fangda Partners as the administrator on November 13, 2023. With further support from various parties, Trendzone Holdings’ first creditors’ meeting and convertible bond holders’ meeting took place on December 15, 2023, where the restructuring plan received approval by a large majority of each voting group. The number and percentage of creditors in favor of the draft restructuring plan and the shares of effective voting percentage of investors endorsing the equity adjustment proposal of the total voting shares presented at the meetings, both exceed 99%. On the same day, the court approved Trendzone Holdings’ restructuring plan. On December 26, 2023, the court confirmed Trendzone Holdings’ restructuring plan had been executed and was complete, concluding the entire restructuring process.

Through the judicial restructuring process, Trendzone Holdings’ financial burden will be significantly reduced, enabling the company to leverage its existing capabilities, adjust its business plan and actively expand its core business. The major investors in the restructuring will also utilize their industrial advantages and resources to jointly explore new business opportunities with the listed company.

Fangda acted as the administrator in the case. The Fangda team was led by Partner Ji Nuo as the overall coordinator, with Partner Li Kai and Partner Zhang Wang acting as the heads of the administrators. Team members also included Partner Sophia Feng, Counsel Kang Wen, and associates Zhao Zhiwei, Morissa Zhang, Zhang Longhao, Kathy Li, Evie Wang, Rebecca Cao and Cindor Li.

In addition to serving as the interim administrator and the main administrator for Trendzone Holdings, Fangda has recently played a key role in other listed company restructurings, including the first listed company restructuring heard by the Shanghai Bankruptcy Court, in the restructuring of Bestway Marine & Energy Technology Co., Ltd. (300008.SZ). Fangda also played a key role in one of the top ten representative cases before the Fujian courts in 2022: the restructuring of Fujian Start Group Co., Ltd. (600734.SH). Furthermore, Fangda also served on the liquidation team as the temporary administrator for the pre-restructuring of Flower King Eco-Engineering Inc. (603007.SH).