What’s new: A Beijing court assigned a law firm to manage the bankruptcy of Beijing Xinwei Technology Group, setting off a procedure to wind down a company that had sought to take control of Ukrainian engine manufacturer Motor Sich.
The Beijing No. 1 Intermediate People’s Court appointed Haiwen Law Firm Tuesday as the bankruptcy liquidation administrator for Beijing Xinwei, court documents showed. Creditors can file debt claims by May 5.
Xinwei said in a statement that it “will continue pushing forward the purchase of Motor Sich in a bid to change the course of the bankruptcy,” although the deal has hit a deadlock due to national security concerns in Ukraine.
The background: Beijing Xinwei has sought to take over Motor Sich for the past few years through its subsidiary Beijing Skyrizon Aviation. Motor Sich is one of the world’s largest manufacturers of missile, helicopter and jet engines.
But Ukraine regulators have held up the deal on national security grounds. Last year, Ukraine and the U.S. Commerce Department imposed sanctions on Beijing Xinwei and Beijing Skyrizon, stymying the takeover bid. Skyrizon brought an international arbitration case in the matter.
Beijing Xinwei was delisted from the Shanghai stock exchange in June 2021 after reporting losses of 26.5 billion yuan in the previous four years.
Controlling shareholder Wang Jing pledged to inject Beijing Skyrizon’s assets, including its Motor Sich stake, into Beijing Xinwei to bolster its financial condition.
Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (bob.simison@caixin.com)
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