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TORONTO - Li-Cycle Holdings Corp. (OTC Pink Markets: LICYQ), a prominent lithium-ion battery recycling firm currently showing weak financial health according to InvestingPro analysis, has been issued a cease trade order (CTO) by the Ontario Securities Commission (OSC) due to its failure to submit required financial documents. The company’s overall financial health score stands at a concerning 1.6 out of 5, reflecting significant operational challenges. The CTO, effective immediately after market closure on June 5, 2025, prevents trading of the company’s securities in Ontario and other Canadian jurisdictions with reciprocal order provisions.
The company did not file its interim financial statements, management’s discussion and analysis for the quarter ended March 31, 2025, and the certifications for these filings as mandated by Ontario securities laws. This order does not apply to beneficial security holders of Li-Cycle who were neither insiders nor control persons as of the CTO date, allowing them to sell their securities acquired before the CTO under specific conditions.
Li-Cycle’s shares, currently quoted on the OTC Pink Markets, do not fulfill the criteria of a "foreign organized regulated market" (FORM), which is one of the conditions for the allowed sale of securities by beneficial holders. The company’s common shares are anticipated to continue trading on the OTC Pink Markets until approximately June 30, 2025, when they are expected to move to the OTC Expert Markets following Li-Cycle’s decision not to pursue additional public disclosure obligations in Canada and the United States.
Previously, on May 14, 2025, Li-Cycle sought creditor protection under Canada’s Companies’ Creditors Arrangement Act (CCAA), which was recognized by the U.S. Bankruptcy Court in New York the following day. This protection was amended and restated on May 22, 2025. InvestingPro data reveals the company’s substantial debt burden of $446.3 million and a concerning current ratio of 0.58, indicating potential difficulties in meeting short-term obligations.
Investors holding Li-Cycle securities are recommended to consult with their investment advisors or legal counsel to understand the implications of the CTO. Details of the CTO can be found on SEDAR+, and information about the CCAA proceedings is available on the website of the Court-appointed monitor, Alvarez & Marsal Canada Inc.
Li-Cycle, established in 2016, focuses on the recovery of critical materials from spent lithium-ion batteries, aiming to foster a closed-loop supply chain for the clean energy sector. Despite revenue growth of 53% in the last twelve months, InvestingPro analysis shows the company has been struggling with negative gross profit margins and rapidly depleting cash reserves. This news is based on a press release statement. For comprehensive analysis of Li-Cycle’s financial situation, investors can access detailed Pro Research Reports available on InvestingPro, covering over 1,400 US stocks with expert insights and actionable intelligence.
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