July 2, 2013 / 9:32 AM / in 5 years

UPDATE 2-China probes infant milk firms for antitrust violations

* Danone, Nestle, Mead Johnson, Abbott cooperating with investigation

* Danone shares down 1.5 pct, Nestle shares off 0.8 pct (Recasts with statements from Abbott, Mead Johnson, share price moves)

SHANGHAI, July 2 (Reuters) - Infant formula makers Nestle SA , Danone, Mead Johnson Nutrition Co and Abbott Laboratories confirmed on Tuesday that they are being investigated by China’s top economic planning agency for possible antitrust violations.

The companies said they were cooperating with China’s National Development and Reform Commission (NDRC) in its investigation into possible price-fixing and anti-competitive practices.

Mead Johnson, whose shares were down about 6 percent in New York, said it was “fully cooperating” with the antitrust review and would provide information in response to inquiries received from government officials.

Officials at Danone, Abbott, Nestle and Wyeth Nutrition also said they were cooperating. Officials at the NDRC were not available to comment.

Abbott shares were down 0.8 percent in afternoon trade in New York, while Danone shares closed down 1.5 percent in Paris. Nestle shares fell 0.8 percent.

Foreign infant formula is highly coveted in China, since public trust was damaged by a 2008 tainted infant formula scandal that left at least six children dead. Foreign brands now account for about half of total sales.

The Beijing Times, which first reported the probe, said the investigations came to light after a Hong Kong-listed infant nutrition manufacturer Biostime International Holdings said last Thursday that its Guangzhou unit was under investigation by the NDRC for an alleged violation of China anti-monopoly law.

“The main purpose of the investigation is in relation to an alleged violation of Article 14 of Anti-Monopoly Law of the People’s Republic of China by Biostime Guangzhou in managing the market sales prices at which the distributors and retail sales organizations sell our products,” the company said in a filing to the Hong Kong stock exchange. (Reporting by Melanie Lee and Shanghai Newsroom, Additional reporting by Dominique Vidalon in Paris and Martinne Geller in New York, Editing by Kazunori Takada, Michael Perry, Mark Potter and Bernard Orr)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below