A Scheme Of Bankruptcy Reorganization And Enterprises Restructuring For GSAC And HXAC

Policy-based bankruptcy features prominently in promoting reform onstate-owned enterprises and plays a unique role in well-solving the problems left on acertain historical period. Subject to the local government as an entity ofimplementation and responsibility, it involves central, local finance and state-ownedfinancial institutions to share the reform costs, which help those seriously insolventand difficulty-plunged state-owned enterprises declare bankruptcy hence close. At thesame time, the efficient and left resources whereof are used to the restructuring andreorganization for the realization of individually-run enterprises.In June 2005, verified by the State-owned Assets Supervision AdministrationCommission of the State Council of People's Republic of China, Gansu AluminumCompany (GSAC) and Huaxing Aluminum Company (HXAC) was appointed to thenew addictive policy-based bankruptcy items. In July 2007, GSAC and HXAC wasformally listed as policy-based bankruptcy planning by State Leading Group of Mergeand Bankruptcy of Enterprises and Re-employment of Workers. Therefore, with thehelp of policy opportunities, the reborn of GSAC and HXAC are hung on the string ofwell-organized and applicable scheme on bankruptcy reorganization and enterprisesrestructuring.This article, firstly, made the brief analysis on the journey of state-ownedenterprises reform in China and gave the basic description of GSAC and HXAC.Secondly, the detailed scheme on bankruptcy reorganization and enterprisesrestructuring for GSAC and HXAC was presented from various angles such as reformmodel, expenditure measuring, arrangement of redundant workers, assetsreorganization and administrative model of restructured company. Last, a relativelythorough and profound discussion was performed on the following importantquestions concerned as the benefits of creditors, rights and interests of workers, socialsecurity, assets appraisal, identities of share holders in restructured company, administrative structure of restructured company and state-ovmed assets supervisionof restructured company etc. To sum up, the implementation of the scheme, on onehand, will help the difficulty-plunged state-owned enterprises i.e. GSAC and HXACgo smoothly and orderly in stepping off the market. On the other hand, the successorDongxin Aluminum Company, established upon modern enterprises system, willbecome the new emerging force in Chinese Aluminum smelting industry.