Man Wah Holdings Limited (Man Wah Hldgs) disclosed that Southern Motion, Inc.—a direct wholly-owned U.S. subsidiary acquired in December 2025—has voluntarily commenced Chapter 11 bankruptcy proceedings to address commercial disputes with its landlord and several other creditors.

The filing follows operating losses at Southern Motion and aims to protect the interests of employees, key suppliers and customers while the business continues to operate under court supervision. Six of the subsidiary’s eight manufacturing facilities in northern Mississippi are leased from a single landlord involved in the dispute.

The acquired Gainline Recline Intermediate Corp. group, which includes Southern Motion, contributed approximately 2% of Man Wah Hldgs’ total revenue in the financial year ended 31 March 2026 (FY2026). On a pro-forma basis—assuming the acquisition had been completed at the start of FY2026—the contribution would have been about 8%.

The board advised shareholders and potential investors to exercise caution when dealing in the company’s securities.