Sinochem International subsidiary enters bankruptcy reorganization

Sinochem International (Holdings) Co., Ltd. announced that its controlled subsidiary, Ningxia Sinochem Lithium Battery Materials Co., Ltd. (Ningxia Lithium), has received a civil ruling from the Zhongwei Intermediate People's Court. The court accepted Ningxia Lithium's application for bankruptcy reorganization and appointed a manager. This follows a decision by Sinochem International's board on October 13, 2025, to approve Ningxia Lithium's application due to sustained losses, insolvency, and inability to clear due debts, driven by external market conditions.

As of December 31, 2024, Ningxia Lithium reported total assets of yuan 277.81m and total liabilities of yuan 301.07m, with a net loss of yuan 524.94m for the year. By September 30, 2025, total assets were yuan 240.62m and total liabilities yuan 286.74m, with a net loss of yuan 23.53m for the first nine months. Sinochem International holds a 94% equity stake in Ningxia Lithium.

The court's acceptance of the reorganization application aims to resolve current crises and protect creditors' interests. Sinochem International had receivables of yuan 240.94m from Ningxia Lithium as of September 30, 2025, with a bad debt provision of yuan 34.58m. The company has fully provisioned for its yuan 470m long-term equity investment in Ningxia Lithium. Sinochem International also previously provided guarantees for Ningxia Lithium's loans amounting to yuan 226.41m. The outcome and impact on Sinochem International's profit and loss remain uncertain as the reorganization plan is yet to be finalized.