Breaking news! Equipment giant sues lithium battery giant

On the evening of January 24, lithium battery equipment giant Liyuanheng (688499) issued an announcement stating that it had filed a lawsuit with the Intermediate People's Court of Changzhou City, Jiangsu Province regarding a contract dispute between the company and lithium battery giant Honeycomb Energy, and recently received the "Notice of Acceptance of Cases" issued by the Intermediate People's Court of Changzhou City, Jiangsu Province, with case numbers (2025) Su04 Minchu 4 and (2025) Su04 Minchu 5.

"As of the date of disclosure of this announcement (January 24, 2025), the case has been accepted and has not yet been heard in court."

The announcement introduced that the plaintiff is Liyuanheng and there are two defendants: one is Honeycomb Energy Technology (Yancheng) Co., Ltd., and the other is Honeycomb Energy Technology Co., Ltd.

Liyuanheng requested:

1. Order Yancheng Honeycomb Energy to pay approximately RMB 345 million and liquidated damages for overdue payment;

2. Order Yancheng Honeycomb Energy to bear the travel expenses, security guarantee fees of RMB 139,606.74, and attorney fees of RMB 925,793.68 incurred by the plaintiff in defending its rights in this case;

3. Order Honeycomb Energy to bear joint and several liability for the above-mentioned debts of Yancheng Honeycomb Energy in Items 1 and 2;

4. Order the two defendants to bear all litigation costs such as case acceptance fees and security fees.

The above temporarily totals approximately RMB 354 million.

The reason why Liyuanheng sued Honeycomb Energy is that on August 17, 2022, Liyuanheng Germany and Honeycomb Germany signed the "Esmart 300 Module Assembly Line Procurement Contract for Honeycomb European Factory"), which stipulated that Honeycomb Germany would customize and purchase Esmart 300 module assembly line equipment from Liyuanheng Germany.

After the contract was signed, Lyrics Germany produced the equipment as agreed, and delivered the equipment to No. 29 Xinbei, Dafeng District, Yancheng City, Jiangsu Province, China in December 2023 as required by Honeycomb Germany.

In April 2024, Lyrics Germany and Honeycomb Germany signed a "Supplementary Agreement", which clearly stated that the delivery location of the equipment was changed to No. 29 Xinbei, Dafeng District, Yancheng City, Jiangsu Province, China. Honeycomb Germany arranged for Yancheng Honeycomb Energy to conduct pre-acceptance and final acceptance of the equipment, and issued a final acceptance report for the equipment in accordance with the original contract. The dispute was submitted to the People's Court of Jintan District, Changzhou City for litigation.

In June 2024, Yancheng Honeycomb Energy signed the "Equipment Pre-Acceptance Report". Honeycomb Germany and Yancheng Honeycomb Energy also put the equipment into production, but they did not fulfill their payment obligations as agreed.

In October 2024, after consultation among all parties, it was agreed that Party A of the "Honeycomb European Factory Esmart300 Module Assembly Line Procurement Contract" was changed to Yancheng Honeycomb Energy and Party B was changed to Lyrics. Therefore, Yancheng Honeycomb Energy should assume the payment obligation under the "Esmart 300 Module Assembly Line Procurement Contract for Honeycomb European Factory".

As of now, after repeated urging by Liyuanheng, Yancheng Honeycomb Energy still has 13.5032 million euros of contract money unpaid under the contract.

In addition to the above, from 2022 to 2024, Yancheng Honeycomb Energy signed multiple procurement contracts with the plaintiff to customize and purchase multiple lithium battery production equipment including assembly equipment and positive/negative laser die-cutting machines from Liyuanheng.

After the contract was signed, Liyuanheng completed the production as agreed and delivered all the equipment to the first defendant. Yancheng Honeycomb Energy also put all the equipment into production and use. Some of the equipment has been accepted and qualified, and some of the equipment has not been debugged and accepted due to the reasons of Yancheng Honeycomb Energy.

As of now, after repeated urging by Liyuanheng, Yancheng Honeycomb Energy still has about 216 million yuan of money that has not been paid to Liyuanheng, and the behavior of Yancheng Honeycomb Energy has constituted a breach of contract.

Finally, Liyuanheng said that if some or all of the accounts receivable are recovered in the future, it will have a positive impact on the current profit of the accounts receivable; if some or all of the accounts receivable are not recovered in the future, the company will continue to make provisions for bad debts in accordance with the enterprise accounting standards, which may have an adverse impact on the company's profit and loss.

It is worth mentioning that on the evening of January 24, Liyuanheng also issued an announcement on the expected loss of annual performance in 2024, which attracted widespread attention in the capital market. The announcement showed that Liyuanheng expects the annual net loss in 2024 to be between 859 million yuan and 1.05 billion yuan. Compared with the net loss of 188 million yuan in the same period last year, the loss in 2024 has further expanded significantly.