(Yicai Global) July 6 -- Ping An Insurance Group, China’s biggest insurer, is set to become the controlling shareholder of Peking University Founder Group after a plan to reorganize the country’s largest university-run business, which is insolvent, secured court approval.

The plan includes setting up New Founder Group, into which the Beijing-based tech conglomerate will inject at least 73 percent of its assets. Ping An Life will then acquire a 70 percent stake in the new firm, one of Founder Group’s listed companies said in a statement late yesterday.

State-backed Founder Group signed an agreement with Ping An, Zhuhai Huafa Group, and Shenzhen Special Development Group on April 30, making them investors in its restructuring.

Under the plan, SDG will take over Founder’s unit Shenzhen Founder Microelectronics, while Ping An and Zhuhai Huafa will buy no less than 73 percent of New Founder Group, for CNY52.93 billion to CNY72.5 billion (USD8.2 billion to USD11.2 billion), China Securities Journal reported earlier.

Founder failed to repay the principal and interest on a 270-day note worth CNY2 billion (USD309 million) at the end of 2019. The group started restructuring talks with the Beijing First Intermediate People's Court two months later.

Last July, the court ordered the merger and reorganization of Founder, Founder Industry Holdings, PKU Healthcare Industry Group, Peking University Founder Information Industry Group, and PKU Resources Group.

Shares of Ping An Insurance [SHA:601318] closed 1.6 percent higher today at CNY62.90 (USD9.73).

Editor: Futura Costaglione