KraussMaffei Co. Ltd. (KMCL) has announced changes to its management on Jan. 1.
In a statement on its Chinese website, KMCL said Chi Zhang, who was appointed CEO of KraussMaffei Group in Germany on Jan. 10, 2024, and Yong Li, who served as CEO in 2023, have resigned from their positions as General Manager and Deputy General Manager of KMCL in Shanghai, respectively. They will, however, continue to serve as directors of the KraussMaffei Group in Germany.
KMCL said the resignations ‘will not affect the normal operation of the company’s board of directors and the normal production and operation of company’ and added that it will strive to appoint a new general manager and deputy general manager as soon as possible.
This resignation announcement is the consequence of KrausMaffei having successfully completed its debt-to-equity conversion process on Dec. 31. The process was first announced in August and, as of Dec. 13, KraussMaffei entered a €478 million ($492 million) transaction to convert existing shareholder loans into equity for China National Chemical Equipment (Luxembourg) S.á.r.l. (CNCE Lux), the parent company of the KraussMaffei Group.
Now that the transaction has been completed, CNCE Lux is 90.76-percent owned by CNCE Group (Hong Kong) Co., Limited (also a Sinochem Company). This means the KraussMaffei Group is no longer a majority owned part of the listed KMCL. This is expected to significantly reduce the company's mandatory financial reporting and administrative workload, freeing up resources to improve KraussMaffei’s capital structure and financial performance.
The new changes in management were triggered by the completion of the debt-to-equity conversion process. Rules of the Shaghai Stock Exchange do not allow Chi Zhang and Yong Li to continue to simultaneously act as senior managers of KMCL and CNCE Lux/KraussMaffei Group, a company spokesperson told Sustainable Plastics.
The series of management changes is the aftermath of a troubled few years for KraussMaffei. KMCL, the former majority shareholder of KraussMaffei Group, posted losses of RMB 2.77 billion ($380.68 million) in 2023, according to that year’s financial report.
After a management reshuffle in early 2024 at the KraussMaffei Group in Germany, Chief Financial Officer Jörg Bremer also requested to leave the company on July 31.
Before being appointed as CEO of the KraussMaffei Group in Germany in 2024, Chi Zhang had been with Sinochem, KraussMaffei’s owner, for more than two decades in a variety of executive, operational, and project-related management positions. Since the end of 2022, he was the Chairman of CNCE.
*This article was updated on Jan. 3, 2025, to clarify that Chi Zhang and Yong Li resigned as General Manager and Deputy General Manager, respectively, at KraussMaffei Company Limited (KMCL), not KraussMaffei Group.
