Brilliance Auto is one of the earliest Chinese auto manufacturers to enter the capital market. On March 26, China International Capital Corporation Limited (hereinafter referred to as “CICC”) issued a report on the interim trusteeship management affairs. The report shows that the articles of association of Brilliance Group have changed. After the shareholders’ decision, Brilliance Group will not set up a board of directors, but set up an executive director, not set up a board of supervisors, and set up a supervisor. At the same time, there have been major personnel changes in Brilliance Group. Shen Tiedong will no longer serve as the secretary of the Party committee, chairman, and legal representative of Brilliance Group, and Liu Yanhui will serve as the executive director and legal representative of Brilliance Group.
According to the information, Shen Tiedong graduated from the Department of Political Economy, Liaoning University, majoring in political economy. He started working in June 1992 and has successively served as the deputy mayor of Panjin Municipal People’s Government, and the member of the Standing Committee and secretary-general of Panjin Municipal Party Committee. Later, he was transferred to Liaoning Energy Investment (Group) Co., Ltd. as the deputy secretary of the Party committee, vice chairman, and general manager, and the Party secretary and chairman of Liaoning Provincial Environmental Protection Group Co., Ltd. In June 2021, a cadre meeting of Brilliance Group announced the decision of the Liaoning Provincial Party Committee: Shen Tiedong was appointed as the secretary of the Party committee and chairman of Brilliance Group, and Yan Bingzhe no longer served as the secretary of the Party committee and chairman of Brilliance Group.
From his resume, although he is not from the automotive industry, he has rich experience in the government and enterprises. During his tenure as chairman of Brilliance Group, it was also the stage when Brilliance Group entered the bankruptcy reorganization process. At that time, “how to help Brilliance Auto Group get through the difficult time of bankruptcy reorganization” was an important task after taking office. Afterwards, Brilliance Group no longer sets up a board of directors, which means that there is no longer the post of chairman. Without a board of directors, the executive director will be directly responsible for the company’s operational affairs.
Liu Yanhui serves as the executive director of Brilliance Group and is the legal representative. According to the information, Liu Yanhui graduated from the major of industrial electrical automation at Jilin University in July 1987. He has served as the deputy director and member of the Party committee of the State-owned Assets Supervision and Administration Commission of Shenyang Municipal People’s Government, the chairman and Party secretary of Shenyang Shengjing Asset Management Group Co., Ltd., and has been the Party secretary and chairman of Shenyang Automobile Co., Ltd. since February 2023.
Before this major personnel change, on March 21, there was a personnel change in Brilliance Group. Liu Pengcheng stepped down as general manager and was succeeded by Zhang Yue. Liu Yanhui was the legal representative, executive director, and Shen Tiedong withdrew. At the same time, many directors and supervisors also stepped down, and a new supervisor, Sun Ying, was added. This change occurred after the change of the controlling shareholder of Brilliance Group. The original shareholders, the Liaoning Provincial Social Security Fund Council (Provincial Industry (Entrepreneurship) Investment Guide Fund Management Center) and the Liaoning Provincial People’s Government State-owned Assets Supervision and Administration Commission, withdrew. Its 100% equity was transferred to Shenyang Automobile and officially became a wholly-owned subsidiary of Shenyang Automobile Co., Ltd.
Shenyang Automobile Co., Ltd. was established in February 2023, with Liu Yanhui as the legal representative and chairman, and a registered capital of 4.88 billion yuan. Shenyang Automobile was formed to restructure Brilliance Group, and the actual controller is the State-owned Assets Supervision and Administration Commission of Shenyang Municipal People’s Government. With the orderly progress of the restructuring plan, the default debt of Brilliance Group, which has been in default for nearly 4 years, is expected to be gradually resolved. According to the Enterprise Early Warning System, currently, Brilliance Group has a total of 17.752 billion yuan in default bonds, and there are also 3 non-standard asset default amounts totaling 1.054 billion yuan.
It is reported that Brilliance Automotive Group Holdings Co., Ltd. was established in September 2002 with a registered capital of 800 million yuan. Brilliance Group is a large vehicle manufacturing enterprise controlled by the Liaoning Provincial State-owned Assets Supervision and Administration Commission. It directly or indirectly controls and holds shares in four listed companies, and jointly establishes BMW Brilliance with BMW through its listed company, Brilliance China. The高光 moment of Brilliance Automotive occurred in 2017, when the stock price rose by 140%, and the total market value reached 88.4 billion yuan.
In October 2018, on the 15th anniversary of BMW Brilliance, the two shareholders of Brilliance China and BMW Group jointly presented a gift to the joint venture company, including extending the joint venture agreement to 2040, and BMW Group will further expand its investment by 3 billion euros to increase the production capacity of the Shenyang production base. However, the most notable is the change in the shareholding ratio of the two shareholders: Shenyang Jinbei (a subsidiary of Brilliance China) will sell 25% of BMW Brilliance to BMW at a consideration of 3.6 billion euros (approximately 28.7 billion yuan). That is to say, the shareholding ratio of Brilliance China in BMW Brilliance has been reduced to 25%, while the shareholding ratio of BMW has increased to 75%.
In July 2002, Brilliance China established Shenyang Jinbei Automobile through its holding subsidiary. The following year in March, Shenyang Jinbei and BMW Group established a joint venture, BMW Brilliance, with a 50:50 ownership ratio. At that time, BMW Brilliance’s annual sales were only 30,000 vehicles, and by 2017, its sales reached 400,000 vehicles. It is no exaggeration to say that relying on BMW Brilliance, Brilliance China has had a good life of “lying down and making money” for more than ten years, resulting in the lack of progress of its own brand. Jinbei has been losing money for many years, and the high-end brand Huasong, which was heavily built, was a flash in the pan. Of course, without Brilliance, BMW would not have its高光 moment in China. In general, they have achieved each other, but Brilliance Group obviously has gained more.
On November 20, 2020, the Shenyang Intermediate People’s Court ruled to accept the application of the creditors of Brilliance Automotive Group to reorganize Brilliance Automotive Group, and Brilliance Automotive Group officially entered the bankruptcy reorganization process. Previously, Brilliance Automotive Group owned three self-owned brands, Zhonghua, Jinbei, and Huasong, and two joint venture brands, BMW Brilliance and Brilliance Renault. However, by 2024, Brilliance Automotive Group only had BMW Brilliance to support it, and the shareholding ratio was reduced from 50% previously to 25%. The days of relying on BMW Brilliance to “lie flat” are gone forever.
Since November 2020, when the application for bankruptcy reorganization was accepted, the reorganization of Brilliance Automotive Group has lasted for more than three years. According to the above announcements of Jinbei Automobile and Shenhua Holding, the restructuring plan of Brilliance Automotive Group has not been completed yet. As of press time, Brilliance China is quoted at HKD5.70 per share, with a increase of 0.35%, and a total market value of HKD28.76 billion. Currently, under the leadership of the State-owned Assets Supervision and Administration Commission of Shenyang, how Brilliance Automotive Group can be reborn is of great concern.
