The shares, which had been stable and sat at HK$2.80 (US$0.36) on March 23, plummeted to HK$0.42 (US$0.054) the following day, wiping out an estimated US$4.1bn in market value in the stock.
China Huishan Dairy Holdings Company Limited and FrieslandCampina each own 50% of the shares in a joint venture, Friesland Huishan Dairy, of which FrieslandCampina has full management control.
FrieslandCampina said the joint venture was established for the production and marketing of infant milk formula under the Dutch Lady brand in the People’s Republic of China. The joint venture also produces tea and coffee creamers.
The milk provided by China Huishan Dairy Holdings Company Limited to the joint venture comes from its own dairy farms in China.
FrieslandCampina has confirmed Friesland Huishan Dairy continues to be operational and focuses on continuity for employees, customers and suppliers.
It adds that it is closely monitoring the situation and will, if necessary, “take appropriate action to ensure successful continuation of the joint venture’s activities in the Chinese market.”
China Huishan Dairy
China Huishan Dairy Holdings Company Limited produces dairy products, as well as growing and processing alfalfa and supplementary feeds, and processing concentrated feed.
Its operations include dairy farms, and the manufacture of milk and whey power products that are distributed throughout China.