CaiXin Development Management undergoes a dramatic change, company restructuring faces obstacles and slides into *ST

After the market close on March 10, Caixin Development (000838.SZ) announced that the company has completed its business registration change. Recently appointed President Xian Xianian will serve as the company’s legal representative. On the same day, another announcement indicated that the company will be classified as “*ST” after disclosing its 2025 annual report.

Recently, Caixin Development’s management team has undergone significant changes. On March 5, the company announced that Directors Liu Junquan, President Jasen, and Vice President and CFO Yan Daguang all submitted written resignations.

According to the announcement, Liu Junquan resigned from his position as a director of the 11th Board of Directors due to work arrangements, and also stepped down from all related roles including member of the Strategic Committee, Compensation and Assessment Committee, and Nomination Committee. After resigning, he will no longer hold any position in the company. Jasen resigned as President but will continue to serve as Chairman of the 11th Board of Directors and as a member of the Strategic Committee, responsible for the overall strategic direction of the company. Yan Daguang’s departure was due to personal reasons; after resigning as Vice President and CFO, he will no longer hold any position in the company.

On the same day, Caixin announced the appointment of Xian Xianian as President. His public profile shows he was born in April 1971 and is currently Assistant President/ Supervisor at Chongqing Caixin Enterprise Group Co., Ltd. He previously served as General Manager of Chongqing Caixin Real Estate Development Co., Ltd., Chairman of Chongqing Caixin Group Co., Ltd. (now known as Chongqing Caixin Holding Group Co., Ltd.), Vice President, Chairman, and President of Chongqing Caixin Enterprise Group Co., Ltd., and Chairman of the company’s Supervisory Board. Additionally, Xiong Huanwei was appointed as CFO, and Xian Xianian was nominated as a candidate for Director of the 11th Board.

The “Caixin system” was once one of the most powerful private real estate and financial enterprises in Chongqing. Its founder, Lu Shengju, started in Fuling, Chongqing, and over 20 years built a business group spanning real estate, trust, environmental protection, and other fields. In 2016, Lu led a consortium that announced plans to acquire the Chicago Stock Exchange, gaining widespread attention. However, just six years later, in 2022, the “Caixin system” faced liquidity issues and repeatedly defaulted on debts.

Subsequently, Caixin Development attempted to revive through restructuring, and external capital showed interest in “taking over” the listed company. In October 2024, Caixin Development announced that controlling shareholder Caixin Real Estate and indirect controlling shareholder Caixin Group applied to the Fifth Intermediate People’s Court of Chongqing for pre-restructuring, which was filed and registered. In February 2025, the court approved the formal restructuring, marking a significant phase in the Caixin system’s restructuring. In October 2025, Jiangxi Zhongjiu Natural Gas Group was identified as the preferred investor, and both parties signed a restructuring investment agreement. Jiangxi Zhongjiu plans to acquire 20% to 29.99% of Caixin Development’s shares, and upon completion, will become the company’s controlling shareholder.

Public information shows Jiangxi Zhongjiu was established in 2014 with a registered capital of 260 million yuan. Its main businesses include urban gas, industrial direct supply, LNG logistics, etc. It is wholly owned by Yong Zhijun and Lu Yifan. In March 2025, it invested 638 million yuan to acquire a stake in Xinjiang Torch (603080.SH).

However, the restructuring process of Caixin Development has repeatedly encountered obstacles. According to company announcements, on December 16, 2025, the company received a notice from the administrator that some creditors could not complete on-site voting for the “Substantive Merger and Restructuring Plan (Draft)” and the “Proposal to Establish a Creditors’ Committee” for Chongqing Caixin Enterprise Group Co., Ltd. and thirteen other companies. Internal approval processes are still ongoing, and the voting deadline has been extended. On January 9, 2026, the voting was postponed again to February 9. On February 10, Caixin Development announced that “both proposals have not yet been approved.”

As the restructuring has been delayed, Caixin Development’s operational difficulties have worsened. According to the company’s January 30 performance forecast, it expects to achieve operating income of 200 million to 290 million yuan in 2025, a significant decline. Net profit attributable to the parent is forecasted to be a loss of 500 million to 800 million yuan, nearly doubling the 260 million yuan loss in the same period last year. Non-recurring net profit is expected to be a loss of 480 million to 780 million yuan, compared to a loss of 218 million yuan in the previous year.

The forecast also states that on January 30, 2026, the Chongqing Tax Bureau issued an announcement clarifying certain land value-added tax (LVAT) collection policies. This regulation will require the company to make large additional LVAT payments for some projects that have not yet been declared and settled, significantly impacting the company’s attributable profit. Coupled with asset impairments, losses from joint ventures, and deferred tax recoveries, the losses are expected to increase substantially compared to the previous year.

Caixin Development states that the relevant matters are still under review, and the final amount will be determined after audit. Based on the changes in regulations and prudence, the company expects that the additional LVAT payments for projects not yet declared will impact its 2025 net profit attributable to the parent by approximately a 300 million to 450 million yuan loss.