The group -- China's largest private aviation conglomerate and owner of one of the country's biggest carriers Hainan Airlines -- filed for bankruptcy in January after struggling to resolve a drawn-out cash crisis.
Since then it has been in a restructuring process overseen by the local government as it tries to settle debts.
The revamp will see the mammoth group split into four sections -- aviation, airports, financial and commercial -- with new shareholders.
HNA said in a statement Sunday that a court in southern Hainan where it is based had approved a plan for the reorganisation.
The restructuring comes as investors eye the fate of property giant Evergrande, which is mired in more than $300 billion of liabilities from a years-long acquisition binge, including into electric vehicles that were once billed as a rival to Elon Musk's dominant Tesla brand.
While the government has not yet decided to bail out the struggling developer, analysts say Evergrande could be forced to undergo a similar state-led restructuring.
Once an aggressive dealmaker, HNA had investments spanning the aviation, tourism, real estate and financial services sectors as part of an acquisition binge.
But in 2017, the government cracked down on its aggressive global expansion, forcing it to slim down its assets.
The court decision comes after the head of HNA's joint working group leading the restructuring, Gu Gang, said the firm had confirmed 1.1 trillion ($172 billion) in creditor claims.
Creditors voted on the restructuring plan last month, and most backed it.
In September Chinese police detained two top executives of the debt-laden conglomerate on suspicion of "illegal crimes".
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