Director Publicly Opposes China Fortune Land Development's Pre-Restructuring, Citing Lack of Notification and Violation of Corporate Governance

China Ping An Insurance holds a cumulative 25% stake in China Fortune Land Development Co.,Ltd. (CFLD), making it the largest and controlling shareholder. However, among CFLD’s five non-independent directors, Ping An can nominate only one, while CFLD appoints the remaining four.

The Ping An-nominated director is Wang Wei, a long-time Ping An executive who concurrently serves on CFLD’s board. Wang previously held roles including Assistant President of Ping An Bank’s Jinan Branch, Assistant/Deputy President of its Energy Finance Division, and Deputy Chief Risk Officer of its Special Asset Management Division. She currently serves as Risk Management Expert at Ping An Life Insurance’s Investment Management Center while holding a directorship at CFLD.

Directors are typically nominated by shareholders to represent their interests in corporate governance. As such, Wang Wei’s role is to voice Ping An’s stance. On the evening of the 19th, Wang unexpectedly published a statement in official media opposing CFLD’s pre-restructuring move.

The dispute arose after small creditors recently filed a court application to initiate bankruptcy restructuring and pre-restructuring for CFLD. While the court approved pre-restructuring (but rejected full bankruptcy restructuring), CFLD’s announcement stated it had "no objection" to the process.

Pre-restructuring and bankruptcy restructuring are legally distinct procedures. Bankruptcy restructuring is irreversible—either succeeding or leading to liquidation—while pre-restructuring is reversible and non-binding.

The core issue lies in whether CFLD’s decision to enter pre-restructuring required board approval—or even shareholder consent. Wang Wei’s public opposition asserts that: 1. The decision must undergo board deliberation and further shareholder voting. 2. Directors (and major shareholders) must be formally notified in advance. 3. CFLD violated corporate governance rules by bypassing these steps, potentially breaching legal requirements.

This puts CFLD’s chairman Wang Wenxue and Hebei provincial authorities in an awkward position. However, the process continues—under the unofficial internet adage: "If you’re unembarrassed, others will be."

Notably, dissenting major creditors may opt out of pre-restructuring claims. The question remains: who is the largest creditor?