Biostime International Holdings Ltd., one of the baby food makers under China’s probe for possible price fixing, fell the most in almost three weeks in Hong Kong trading after pledging to cut some prices as much as 10 percent.
Biostime fell as much as 7.9 percent to HK$35.65 in Hong Kong trading today, the most since July 4 before trading at HK$37.10 at 11:18 a.m. local time. The city’s benchmark Hang Seng Index lost 0.5 percent.
The company’s subsidiary in the southern Chinese city of Guangzhou, where Biostime is based, will lower prices of its infant formula products by 5 percent to 10 percent, the company said in a stock exchange statement yesterday. Biostime earlier this month said it would offer discounts of 11 percent on baby food through reward points.
Biostime is the only domestic milk powder company that was named earlier this month in the Chinese government’s investigation into possible price fixing. The others included Mead Johnson Nutrition Co., Danone, Nestle SA’s Wyeth brand, Abbott Laboratories and Dutch producer Royal FrieslandCampina NV. They have all reduced prices since, some by as much as 20 percent. The probe is ongoing, Biostime said yesterday.
Biostime has signed new distribution agreements with all its distributors to comply with China’s anti-monopoly law, it said.