A Case Study On The Debt Restructuring Of Erzhong Heavy Company

With the development of economy and the continuous improvement of market system,stable external environment provides a broad space for the development of enterprises.Chinese enterprises have made remarkable achievements in their development.However,at the same time of development,fierce competition also makes enterprises face unprecedented challenges.Whether in terms of technology,talent or management,enterprises are required to constantly improve and become bigger and stronger.In recent years,under the pressure of increasingly fierce competition and external environment,listed companies in China often have financial crises due to internal control,internal governance structure and improper strategic decision-making,which lead to difficulties in the operation of funds,deterioration of operating conditions and even the consequences of delisting.In order to improve the efficiency of enterprises,optimize the allocation of social resources,and solve this bottleneck affecting the development of enterprises,debt restructuring has become an effective solution.Through debt restructuring,on the one hand,companies can bear debts and solve financial crisis,on the other hand,they can activate funds and optimize capital structure,thus promoting the development of enterprises.This paper studies the case of debt restructuring of Erzhong Heavy company which applied for delisting on its own initiative.Based on the financial indicators before and after the restructuring,this paper analyses the financial effects of debt repayment ability,profitability,operation ability and growth ability after the debt restructuring,and judges the successful case of Erzhong Heavy company turning loss into profit through debt restructuring,which will give Chinese enterprises,especially machinery and equipment manufacturing enterprises.The improvement of the financial situation of enterprises and delisting enterprises provides some reference for similar loss-making enterprises to improve their financial situation through debt restructuring,so as to achieve sustainable development of enterprises.