Chinese CATL components supplier Yunnan Energy New Material says top executives under house arrest

Chairman Paul Xiaoming Lee and vice-chairman Li Xiaohua have been placed in residential confinement by the police, firm says in filing to Shenzhen exchange

Company says operations unaffected by absence of its two top executives and that it is ‘operating in a normal manner’

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A general view of Shenzhen. Yunnan Energy New Material’s shares plunged 10 per cent on Tuesday in Shenzhen after the announcement and triggered circuit breakers. Photo: Martin Chan

Published: 3:45pm, 22 Nov 2022

The top executives of lithium battery components maker Yunnan Energy New Material and members of Yunnan province’s richest family have been placed under house arrest, the company said on Tuesday.

“The company was informed on November 20 that chairman Paul Xiaoming Lee and vice-chairman Li Xiaohua have been placed in residential confinement at a designated residence by the police due to related matters,” the company said in a filing to the Shenzhen Stock Exchange.

Yunnan Energy New Material, which makes lithium ion isolation film, an important component of lithium batteries widely used in electric vehicles (EVs), did not disclose details of the “related matter”, which it said is under investigation.

The company counts Chinese battery giant Contemporary Amperex Technology Limited (CATL), Japanese battery maker Panasonic and South Korea’s LG Chemical among its customers. Its shares plunged 10 per cent on Tuesday to 140.17 yuan in Shenzhen after the announcement and triggered circuit breakers.

Yunnan Energy New Material’s operations would remain unaffected by the absence of its two top executives, it said in the filing. “The company has a complete governance structure and internal controls. It is operating in a normal manner, and will continue to pay close attention to [the detention of its top executives] and will disclose information in time,” it said.