Debt-ridden Tianqi Lithium will have to pay some 13.6 billion yuan ($2 billion) in debt – equal to one third of its total assets – to China Citic Bank by November this year, according to its interim report filed to Shanghai Stock Exchange on Monday.
The payment is part of a $3.5 billion loan borrowed in 2018 for the high-profile acquisition of a 25.86% stake in Chilean mining company Sociedad Quimica y Minera de Chile.
Tianqi’s large loan repayment debt contrasts with its earnings from the Chilean enterprise of just 129 million yuan in the first six months of the year.
Combined with declining sales and product prices, Tianqi’s revenue dropped 27.44% to 1.88 billion yuan compared to the same period last year due to the Covid-19 fallout, swinging from 193.4 million yuan profit in the first half of 2019 to a net loss of 696.6 million yuan.
The company’s former CEO Wu Wei, who led the gigantic acquisition deal, resigned on Aug. 14. Tianqi’s Chairman Jiang Weiping is currently holding the post.
Contact reporter Lu Yutong (email@example.com)
Read the full story: Spiraling Sales and Prices Drive Lithium Giant to $101 Million Loss