On June 6, 2025, the Shanghai Pudong New Area People’s Court (“Pudong Court”) approved the restructuring plan of Red Star Macalline Holding Group Co., Ltd. and terminated the restructuring proceedings of Red Star Macalline Holding Group Co., Ltd. (“Red Star Holdings”). The case is now in the implementation stage of the restructuring plan. Red Star Holdings is a well-known Chinese large private enterprise group, with business operations spanning multiple sectors including home-furnishing retail malls, real estate development, automotive production line design and EPC contracting, and film and entertainment. It is the second-largest shareholder of Red Star Macalline Group Corporation Ltd., a leading listed home-furnishing retail enterprise in China with A-share and H-share listings.
On July 1, 2024, the Pudong Court accepted the restructuring application of Red Star Holdings and appointed Fangda Partners as the administrator. During the restructuring, creditors filed claims worth more than CNY 70 billion. Of those, the administrator confirmed more than 500 claims, worth more than CNY 30 billion. These confirmed claims included approximately CNY 10 billion in publicly issued bonds, as well as many contingent claims.
On June 6, 2025, after 11 months of restructuring proceedings, the restructuring plan was approved by all voting groups at the creditors’ meeting. The Pudong Court approved the restructuring plan and terminated the restructuring procedure. The case is now in the implementation stage of the restructuring plan.
On March 4, 2026, the Pudong Court released its 2025 Typical Bankruptcy Adjudication Cases. The Red Star Holdings restructuring case was listed among those cases.
This case introduced several practical innovations, such as:
• Not adopting substantive consolidation in the bankruptcy of a large enterprise group
• Using listed company shares at market price to repay debts in the restructuring of an important shareholder of a listed company
• Setting review and repayment standards for conditional claims
• Allowing creditors and the debtor to pursue a self-rescue without external investor involvement
• Establishing a performance-based adjustment (earn-out) mechanism between the original shareholders and creditors
• Introducing cumulative voting for independent directors in limited liability companies
• Designing flexible arrangements for the escrow of debt repayment resources.
Fangda Partners’ insolvency and restructuring practice draws on the firm’s fully integrated platform. Legal experts from different practice areas work together in dedicated insolvency and restructuring teams. We have deep experience designing market-driven transaction structures and balancing the interests of creditors, investors, and debtors to develop restructuring plans that are both widely acceptable and practically implementable. In addition to acting as court-appointed administrator in large, complex insolvency cases, Fangda also advises clients across the full spectrum of insolvency matters, including restructuring investments, representing creditor committees, and safeguarding creditor interests and rights.
The administrator team in this case was coordinated by Insolvency partner JI Nuo, with Insolvency partner CHEN Guanbing acting as the head of the administrator team. The team also included the following partners: LI Kai (Insolvency), Joyce HUANG (Insolvency), Leo LOU (Capital Markets), and Stephen LIN (Real Estate).
Team members also included: Insolvency counsel Pei Kun and associates Edmund WEI, Morris DONG, Jasmine ZHAO, REN Erwei, Katy LU, NONG Ling, and Celeste WANG; Capital Markets counsel CAO Yuan and associate YU Jinyuan; Real Estate associates CHEN Qianyun, Hattie ZHANG, and Chelsey FEI; and Dispute Resolution counsel Laurie ZHOU and associate Ryan ZHU.
Special thanks to Tao Qianyingqi for her contributions.
