Zoomlion jumps after paper’s apology

Shares in Zoomlion Heavy Industry Science and Technology Co jumped yesterday after a newspaper admitted it had failed to verify reports that questioned the finances of the leading Chinese construction machinery maker.

The Guangzhou-based New Express Daily apologized for publishing the stories after a China Central Television program aired on Sunday showed Chen Yongzhou, the paper.s reporter, confessing to accepting payments in exchange for writing fabricated reports about Zoomlion.

Zoomlion jumped 4.8 percent in Hong Kong trading yesterday. That trimmed the loss this year to 38 percent. Zoomlion's A shares in Shenzhen rose 6.2 percent yesterday.

The newspaper said on Sunday after the CCTV program was aired that it failed to carefully review Chen's stories before publishing them. The incidence has seriously damaged the credibility of the press, the New Express said.

The Changsha-based company has been the subject of media reports this year that accused it of falsifying sales, which caused its shares to tumble. The company has denied the allegations.

Zoomlion shares suffered a fresh downturn last week after news of Chen.s detention became public which sparked concerns of press freedom and that he might have been set up because Zoomlion is partly owned by the Hunan provincial government and is a main tax revenue contributor to the province.

The New Express also made two front-page appeals for Chen's release last week.

The drama then took a U-turn after the CCTV report showed Chen admitted he took money to write the incorrect reports

It's not clear who paid the money but some reports have pointed to Sany Heavy Industry Co, Zoomlion's local rival.