(Updates with closing share price in second paragraph.)
Oct. 11 (Bloomberg) -- Asian Citrus Holdings Ltd., an operator of orange plantations in China, rose by a record in Hong Kong after saying it won’t renew a contract with a company owned by a man accused of insider trading.
The stock climbed 19 percent, the biggest gain since its debut in November 2009, to HK$5.33 as of the 4 p.m. trading close on the city’s stock exchange. The benchmark Hang Seng Index gained 2.4 percent.
Asian Citrus won’t renew the fertilizer supply agreement with Fujian Chaoda Group after the contract expires in June 2012, according to a statement to the Hong Kong stock exchange yesterday. Fujian Chaoda is 95 percent owned by Chaoda Modern Agriculture (Holdings) Ltd. Chairman Kwok Ho, it said.
Kwok, Chaoda Chief Financial Officer Andy Chan, and Fidelity Management’s George Stairs were accused by Hong Kong’s financial secretary of insider trading, according to a notice released by the tribunal on Sept. 28.
Asian Citrus decided not to renew the contract with Fujian Chaoda in order to “enhance the group’s corporate governance and minimize any dispensable connected transactions,” according to yesterday’s statement.
Boston-based Fidelity Investments conducted a thorough internal review of the matter in 2009 and believes that Stairs didn’t violate any laws or regulations, according to spokesman Vincent Loporchio. Kwok and Chan have disputed the allegations, said Chaoda Modern.
--Editors: Hwee Ann Tan, Rebecca Keenan
To contact the reporter on this story: Marco Lui in Hong Kong at firstname.lastname@example.org
To contact the editor responsible for this story: Rebecca Keenan at email@example.com