--Yunnan Tin probe followed by sharp share price fall
--Company says tin operations not affected by probe into chairman
SHANGHAI--Shares in China's Yunnan Tin Co. (000960.SZ), the world's largest tin producer by output, tumbled Monday, after the company said its chairman is under investigation for alleged "serious disciplinary violations."
The phrase is frequently used in China to refer to senior government or state company officials being investigated for corruption and was used by state media in May when a high-ranking official at China's top economic planning body, the National Development and Reform Commission, was stripped of his post.
The probe into Yunnan Tin chairman Lei Yi, who also chairs the company's state-owned parent Yunnan Tin Group, coincides with the imposition Monday on China's ex-railway minister of a suspended death sentence for bribery and abuse of power.
China's new President, Xi Jinping, has been vocal on the need to crack down on graft and stamp out lavish spending.
At 0330 GMT, Yunnan Tin was down 7.1% at CNY11.69 on the Shenzhen Stock Exchange, up from an intraday low of CNY11.33.
"It looks like it's a knee-jerk reaction (to the company's statement), as well as a follow-up to a 5% slide on the London Metal Exchange on Friday," said a Shanghai-based analyst at Guotai Junan Securities.
Three-month tin on the LME on Friday slumped to an 11-month low, closing some 5.6% down on the day at $18,845 a ton.
Yunnan Tin said vice chairman Gao Wenxiang has taken over the responsibilities of the chairman, and operations at the company remain normal.
"I don't think the probe will lead to any significant changes in fundamentals. After all, the company is still running normally," said the Guotai Junan analyst, who declined to be named.
China has long placed quotas on tin exports and production, citing strategic reasons, although exports have been falling short of these quotas.
The 2013 tin export quota from the Ministry of Commerce was cut to 17,000 tons from 18,000 tons last year.
Yunnan Tin swung to a net loss of CNY194.09 million in the first quarter, with falling sale prices, dragged down by Europe's debt crisis and slowing domestic economy, weighing on its bottom line.
Write to Yue Li at firstname.lastname@example.org