WH Group shares plunge by the most in four months as family feud pits son against father at China’s biggest pork producer
- Media reports citing former director Wan Hongjian said that the founder and former CFO took decisions that led to financial losses
- WH Group denied allegations by former director who was fired recently for aggressive behaviour
One of the sons of its founder, who was stripped of his directorship in June, alleged that his father and the former finance chief took wrong financial decisions that led to losses at the company. WH Group denied the allegations.
The feud dragged its Hong Kong-listed shares 11.3 per cent lower to HK$5.95 on Wednesday, the biggest one-day percentage drop since March 31 and erased HK$11.2 billion (US$1.43 billion) from its market capitalisation. Some 173 million shares totalling HK$1.06 billion were traded, the most since 184 million shares on June 7.
“The company confirms that it is not aware of any reasons for these price and trading volume movements or of any information which must be announced to avoid a false market in the company’s securities or of any inside information,” it said in an exchange filing on early Wednesday afternoon.
Certain media reports regarding allegations made by former director Wan Hongjian against the company were “untrue and misleading”, WH Group said, adding that it would take legal action against Wan if necessary.
Mainland media quoted Wan, 52, as saying that his father Wan Long and former chief financial officer Guo Lijun instigated deals in February to import close to 100,000 tonnes of pork products from the US at higher than market prices, resulting in losses of more than 800 million yuan (US$123.4 million) at its China unit.
