Bankruptcy Reorganization And Its Performance Of Private Enterprises

In recent years,against the backdrop of a gradually declining Chinese economy,industrial upgrading,and increasingly stringent regulatory policies,private enterprises have found it increasingly difficult to raise funds.However,many private enterprises still blindly expand rapidly due to poor management decisions,leading to long-term high-debt operation,difficult cash flow,and easy breaking of the capital chain.The poor ability to resist risk makes them susceptible to financial difficulties when encountering environmental changes,especially the impact of the COVID-19 pandemic in recent years,leading to a dramatic increase in the number of bankruptcies of private enterprises in 2022.In 2007,China introduced the bankruptcy reorganization system as part of the bankruptcy law,bringing new hope and opportunities for enterprises in debt crisis,providing a chance for enterprises with operational and economic value to have a second chance.Compared with bankruptcy liquidation,bankruptcy reorganization can better protect a company’s assets and operating resources,and revive its development through optimizing debt and operating structure,and enhancing competitiveness.Since 2019,the number of private enterprises applying for bankruptcy reorganization has increased dramatically.The number of private enterprises planning or undergoing bankruptcy reorganization has also been constantly rising.However,China’s bankruptcy reorganization system was introduced relatively late,and relevant regulations and systems are still not perfect.Therefore,research on bankruptcy reorganization for private enterprises and its effectiveness is of great significance.This paper analyzes the case of Yongtai Energy,the largest integrated energy private listed company in the A-share market.Its bankruptcy reorganization process lasted only 97 days,setting an unprecedented record in the bankruptcy reorganization of a listed company with assets in the hundred-billion-yuan range.This paper analyzes the reasons for Yongtai Energy’s debt crisis,the bankruptcy reorganization process,and the motive and specific plan design of the bankruptcy reorganization.It also uses the event study method,financial indicator analysis method,and catastrophe progression method to analyze the post-reorganization performance of Yongtai Energy and analyze the stakeholder effect of its bankruptcy reorganization from the perspective of stakeholders.Finally,the Z-value method is used for bankruptcy risk re-examination to deeply study the implementation effect of Yongtai Energy’s bankruptcy reorganization and draw conclusions.This paper found that Yongtai Energy suffered from poor macroeconomic conditions,a stagnant industry,and poor management decisions,resulting in low business performance and a deteriorating financial situation.At the same time,financing policies were tightened,and the company defaulted on its bonds due to an inability to repay them,triggering a chain reaction that led to insolvency.In response to the debt crisis,Yongtai Energy took measures to actively research solutions,considering the interests of the company and stakeholders to develop a restructuring plan that effectively safeguarded the rights and interests of all parties involved.The company successfully completed the bankruptcy reorganization and achieved the goal of sustained operation.Yongtai Energy also adjusted its business plan,strengthened its main business,improved its technological research and development capabilities,reduced costs and increased efficiency,and ensured the company’s internal sustainable development.It is hoped that through the research presented in this paper,it can enrich China’s research on corporate bankruptcy reorganization,provide practical advice and guidance for private enterprises that are undergoing or planning to undergo bankruptcy reorganization,help enterprises overcome financial crises,and achieve long-term and stable development.