The Way To Deal With The "Zombie Enterprise" With Zhejiang Characteristics

"Disposal"

Look north of Shandong and Zhejiang of the south.

Since the end of last year, the central authorities have proposed to actively and properly handle the "zombie enterprises". Our province has been actively acting as a way out of a zombie enterprise with Zhejiang characteristics.

Unlike the North dominated by state-owned enterprises, Zhejiang has always been dominated by private economy, and few state-owned enterprises have concentrated on it.

Competitive areas.

Under such conditions, Zhejiang must deal with the "zombie enterprise" and go out of a road of rule of law and marketization.

At the end of June, around the disposal of "zombie enterprises", journalists went to Wenzhou, Quzhou and other places to conduct field investigations. Through an observation and analysis of a region and an enterprise, they tried to outline the distinctive path of Zhejiang to deal with "zombie enterprises".

Wenzhou has always been a sensitive area of finance.

Behind the speed of every capital pfer is the manifestation of the vitality of the enterprise market.

After the financial turmoil, guarantees, insolvency, non-performing loans, bankruptcy...

These keywords have appeared in Wenzhou business circle and financial circle in recent years and become the focus of domestic attention.

The interrupted capital chain once trapped some enterprises, ceased production and went out of business, and was difficult to continue. In the market, there was a "zombie enterprise".

But when "zombie enterprises" become the hot words in the whole country and discuss how to deal with them, Wenzhou is taking the risk control step by step in a new way.

From the end of last year 7 to the end of 5 this year, 687 emergency loans for enterprises in Wenzhou have been issued, involving 6 billion 800 million yuan.

Compared with the 3000 years in the past two years, emergency lending funds have become less "tight", which is behind the reduction of local ventures and the pformation of financing methods.

At present, Wenzhou is actively handling the "zombie enterprise" in bone scraping treatment.

Through bankruptcy reorganization, bankruptcy liquidation and other ways, Wenzhou's positive and effective disposal of enterprise risks is clearing up obstacles for the new round of development.

The market is clear, so that the economy can gradually restore vitality and vitality.

Bone scraping therapy

On June 24th, near noon, at the office of the leading group office of the Wenzhou venture enterprise assistance and the bad bank loan disposal Agency (hereinafter referred to as the "Wenzhou disposal office"), the head of an agricultural product (000061, stock bar) enterprise is consulting the staff.

"The enterprises that come to seek help are much less than before.

Enterprises with backward production capacity handle more. "

Li Feili, head of the comprehensive coordination unit of Wenzhou disposal office, said that the problems were mainly concentrated in spectacles and tanning.

Shipping and other industries.

According to his analysis, the problems such as "little horse drawn cart" and "short loan and long use" are more prominent in Wenzhou enterprises.

According to the statistics of the intermediate people's Court of Wenzhou, the bankruptcy cases in Wenzhou accounted for almost half of the whole province.

From 2013 to 2015, the court of Wenzhou City handled 554 bankruptcy cases and concluded 425 cases, accounting for 43.79% and 53.59% of the province's total, respectively, with 1888 acres of land and 1 million 114 thousand and 700 square meters of factory buildings.

In the first 5 months of this year, 193 pieces were accepted and 96 were concluded.

In the 5 years before 2013, only more than 20 bankruptcy cases were handled in Wenzhou. On average, each court handled only about 0.5 pieces each year.

"Now the bankruptcy concept of Wenzhou enterprises has undergone a little change."

Zhou Hong, President of the Ouhai court in Wenzhou, said that enterprises, like people, also have a state of life and death, through enterprise bankruptcy reorganization, reconciliation, liquidation, or reinvigorating resources, or realizing rebirth.

In her view, bankruptcy is also broken up, and "breaking is for the sake of establishment", so as to achieve more rational allocation and utilization of resources.

Many bankruptcy reorganization enterprises also admitted that their understanding of bankruptcy is different from before.

In the circle of acquaintances in Wenzhou, the concept of "jumping off a building rather than going bankrupt" has become a basic understanding of Wenzhou enterprises.

Hu Fulin, the "runway boss", has returned to Wenzhou to carry out bankruptcy reorganization of his business.

Hu Fulin, a legal representative of Zhejiang Xintai group and its company, is a leading enterprise in Wenzhou's eyeglasses industry, with 80% of its products exported to the international market.

In September 2011, many factors affected the breakup of enterprise's capital chain and triggered a debt crisis. Hu Fulin went abroad to avoid debt.

In October 2012, Xintai group and its 5 companies applied for bankruptcy reorganization in the Ouhai court, and finally adopted the merger reorganization plan. At present, the reorganization of enterprises has achieved some results.

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Whether the business is good or not, banks are the most sensitive, and the treatment of "zombie enterprises" by scraping the bones is the revitalize of Wenzhou's economy.

Wang Chengliang, governor of Zhejiang Commercial Bank Wenzhou branch, judged that Wenzhou's economic structure had been optimized and the signs of stabilization and recovery were obvious. Although banks were still under great pressure, the operation of banks has improved, and some branches of banks in Wenzhou began to turn losses into profits.

"This also shows that the development of enterprises has improved."

Although the non-performing loan ratio is still high, Wenzhou's non-performing loan ratio has declined for two consecutive years.

Data from the Wenzhou Banking Regulatory Commission also showed that the banking industry in Wenzhou from 1 to May has successfully achieved a "double drop". The balance of non-performing loans and the bad rate decreased by 492 million yuan and 0.13 percentage points respectively.

The change in Wenzhou has even attracted the attention of the Economist magazine, and the situation in Wenzhou is slowly improving.

Make the dead come back to life

In Wenzhou Ruian Tong Pu town, "triple forging" is a well-known local enterprise, but a storm has dragged the enterprise to the brink of death.

Before restructuring, the boss was helpless, and even continued for several days to release the pressure of KTV release.

Tang Jian, general manager of the company, said that after the bankruptcy reorganization started in July 2014, it was generally relatively smooth, and then changed to bankruptcy settlement.

"In 2015, sales increased by 15%, which is expected to reach 20%~25% this year. This year, we plan to invest 10 million yuan for technical pformation."

In the Ruian court, there are many similar cases. Through bankruptcy reorganization, enterprises have "revived". In particular, some enterprises that fall into the crisis of guarantee chain are better than others. They are only dragged down by guarantees, and quickly cut off the guarantee chain to carry out bankruptcy reorganization.

In the whole city of Wenzhou, many bankruptcy reorganization enterprises have gained new development.

"From the bankruptcy cases in Wenzhou, although only about 6% of the bankruptcy cases have been restructured or settled, the amount of debt involved in these cases has exceeded 40% of all bankruptcy cases."

Wenzhou intermediate people's court six people court Chang Fang Chao told reporters that after the success of restructuring, enterprises continue to self repair credit, gradually into the track of normal enterprise development.

As a "product" of the special period, Wenzhou set up a joint meeting system of enterprise bankruptcy disposal in 2014, and agreed on the matters of tax, credit repair and bidding qualification of reorganization enterprises, so as to reduce the cost of reorganization.

"Hai He pharmaceutical" is a busy scene nowadays. It is hard to believe that the 100 year old pharmaceutical company was once on the verge of bankruptcy.

In 2012, because big shareholders were involved in private lending and invested huge amounts of money in investment speculation, "Hai He pharmaceutical" was worth 1 billion 200 million yuan in debt.

In June 2012, the "Hai He pharmaceutical" bankruptcy reorganization started. It took only 10 months to complete the merger and reorganization of "Hai He pharmaceutical" and "Xing Ou pharmaceutical". It used capital flow and purpose as a defining standard to confirm whether the shareholders' personal debt and debtor enterprises are related.

During the period of restructuring, through the open bidding, the introduction of the Beijing United States pharmaceutical Polytron Technologies Inc as a strategic investor, the company won 100% stake in "Hai He pharmaceutical" in 35 million 500 thousand yuan, undertook the GMP (drug production quality management standard) certification, 51 drug approval letters, and "Haihe" brand and other intangible assets.

Another successful reorganization of the "Midtown construction" is also typical. In 2014, when the company applied for bankruptcy reorganization, there were more than 30 thousand workers in the enterprise, and there were more than 70 construction projects in all parts of the country, and more than 300 of the creditors had been declared, so the complexity could be imagined.

In this reorganization case, the competition method was introduced to select bankruptcy administrator and successfully introduced strategic investors.

It is understood that such a complex case finally realized the stripping of the bad assets and the enterprises were reborn.

From the bankruptcy process, we also see the non-standard side of Wenzhou's private enterprises.

Wenzhou's private economy is well-developed, but the corporate governance structure is not clear. The blurred boundary between shareholders' property and company property is not uncommon.

In accordance with the state's legal system, the company's assets are separate from shareholders' property, and the legal system is clear.

But like "Hai Crane Pharmaceutical", some of them are personal loans, but money flows into the company.

There is also a company guaranteed loan, but the money is not used by the company.

The trial judge of the "Hai He pharmaceutical" bankruptcy reorganization recalls that it was a long time since the beginning of the trial, and the identification of different property belonged to this item.

"After that, we also reflect on the conclusion, and feel that a system that is not standardized can be clearly stated at last, and the successful completion of bankruptcy reorganization is just an accumulation of experience for the subsequent work, and it is an experience that can be duplicated and promoted."

Ju Haiting, President of the Ruian court who participated in many bankruptcy reorganization cases, said bankruptcy is also a protection for enterprises and a normal exit mechanism for enterprises.

In view of the business predicament that has occurred in Wenzhou since 2011, Ju Hai Ting said that Wenzhou has made many explorations, including simplifying the trial process and compressing the trial cycle, so as to enable bankrupt enterprises to achieve reorganization, reconciliation or liquidation as soon as possible.

However, bankruptcy reorganization is also facing many problems. Pan Guanglin, vice president of the intermediate people's Court of Wenzhou, said that a series of supporting laws and regulations after completion of the reorganization were relatively lacking, such as tax, credit records and so on.

It is understood that Wenzhou has made some explorations. The government departments can basically solve this problem through coordination, but once the reorganized enterprises are in the field, they often encounter problems.

For example, when an enterprise is reorganized, it is still listed in the blacklist of bidding, which leads to limited development.

"After regrouping, all kinds of codes of enterprises will not change. Bad credit records and tax records of old enterprises will be undertaken by new enterprises."

This concern has been seen and worked by local banks, courts and governments in Wenzhou, but there is no answer to how to solve the problem outside Wenzhou.

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Market clearing

If bankruptcy reorganization and bankruptcy reconciliation bring enterprises a change from "die back to life", then bankruptcy liquidation is a decisive choice for Wenzhou to choose "market clearing".

If we only look at the number of bankruptcy cases, the case of entering bankruptcy liquidation is much more than that of bankruptcy reorganization and bankruptcy settlement.

The "zombie enterprises" exist in name only, the creditors' rights and interests remain undecided, the remaining assets of enterprises are idle, and the enterprises with high quality assets remain in a series of problems, such as stopping production and shutting down due to the inability to pay debts, which once affected the stability of Wenzhou's economic order.

The existence of a large number of "zombie enterprises" seriously hampers economic development. Wenzhou has come to the point where it has to be solved. Under this background, Wenzhou has also made great efforts to clear up the "zombie enterprises without production" and to deploy social resources to better places.

In any market environment, it is possible for enterprises to make mistakes. The most important thing is to correct mistakes. The bankruptcy mechanism is an error correction mechanism. The ultimate goal is to revitalize the resources occupied by "zombie enterprises". What Wenzhou has done is to make good use of resources.

"Time for space" and quality increment drive stock risk mitigation.

Since 2011, Wenzhou has gone through a bony poison bankruptcy storm. In such a way of rule by law, Wenzhou has disposed of a large number of "zombie enterprises" and cut off the "cancer" in economic operation.

Market clearing depends on the means of marketization.

Private enterprises in Wenzhou have long been accustomed to "looking for markets" rather than "finding mayors".

In the process of clearing the market, Wenzhou did not set a list or a target. What the government did was "help".

Wenzhou also did not appear "one size fits all".

In the eyes of Wenzhou officials, the "one size fits all" approach seems to be standard and easy to implement, but in reality it does not work.

Each enterprise is different, and the duration and collateral of each loan are different. If the standard is unified, it is not in accordance with the principle of marketization, and the interests of all parties can not be balanced.

The matching policy of the Wenzhou government also includes financial appropriation of part of the bankruptcy costs.

Some enterprises that are basically "no property" can not afford to pay a series of necessary expenses including bankruptcy administrator's remuneration.

Wenzhou's finance department has set up special funds for bankruptcy. When the enterprises are unable to pay, they will use the fund to pay the necessary expenses.

Our province has clearly put forward the establishment and improvement of the survival of the fittest mechanism, to "zombie enterprises" through mergers and acquisitions, debt restructuring and bankruptcy liquidation to achieve market clearing, continue to shut down backward production capacity, control "low and small scattered".

The problem of Wenzhou enterprises' risk and bad loans broke out earlier than that of the whole province and the whole country. The experience of Wenzhou's market clearing can be used for reference.