Yunnan Jinggu Forestry subsidiary's assets frozen amid loan lawsuits

Yunnan Jinggu Forestry’s controlled subsidiary, Tang County Huiyin Wood Co., Ltd. (Huiyin Wood), is currently embroiled in 28 private lending lawsuits. The latest filings involve claims totaling 11.3 million yuan plus interest, leading to asset preservation measures that have frozen Huiyin Wood's assets valued at 12.82 million yuan. Overall, the total amount across all lawsuits is approximately 145.8 million yuan, representing 153.31% of the company's audited net assets from the most recent period.

As a direct consequence of these legal challenges, Huiyin Wood's nine bank accounts are frozen, and its two production lines for fiberboard and particleboard have ceased operations. This has cast significant uncertainty on the subsidiary's restart timeline and is expected to negatively impact Yunnan Jinggu Forestry's production and operations, further exacerbating a downward trend in operating performance noted in its 2025 half-year report. The company has established a dedicated task force and engaged legal counsel to manage these issues.