Ping An Insurance stock slammed after US$11 billion plan to reorganise assets of bankrupt Peking University Founder group

Ping An and Huafa Group to take up 73 per cent in new entity that will assume Founder’s assets, while 27 per cent is set aside to repay creditors

A separate filing in Beijing shows the restructuring could reach between 53.7 billion yuan and 73.3 billion yuan

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A bank employee counts Chinese one-hundred yuan banknotes. The reorganisation of Peking University Founder Group will involve up to US$11.3 billion. Photo: Bloomberg

Published: 5:58pm, 3 May 2021Updated: 10:47pm, 3 May 2021

China has turned to the nation’s biggest insurance group and state-owned enterprises owned by two municipal governments in a 73.3 billion yuan (US$11.3 billion) deal to restructure the assets of bankrupt Peking University Founder Group.

Ping An Insurance (Group) and Huafa Group owned by the Zhuhai municipal government will take up a combined 73 per cent stake in a company called New Founder Group, according to stock exchange filings. Ping An Insurance said its life-insurance arm will pay as much as 50.8 billion yuan for its contribution.

A separate filing on the Beijing Financial Assets Exchange on Friday showed the restructuring investment agreement could reach between 53.7 billion yuan and 73.3 billion yuan.

The new company will assume the assets of Peking University Founder group involved in health care, information technology, real estate and finance, among others. Shenchao Technology, a unit owned by the Shenzhen municipality and a third member of the rescue team, will buy a separate piece known as Founder Microelectronics.

Peking University in Beijing in a May 2018 file picture. Photo: Xinhua

The consortium will pay the cash in instalments to the administrators, a liquidation team comprising representatives from the People’s Bank of China, the Ministry of Education, the CBIRC Beijing Bureau and each relevant departments of Beijing Municipal Government.