Tycoon Brothers in China Probe Lose $1.3 Billion of Wealth (1)

A police probe into the billionaire siblings behind a fast-growing Chinese battery company has put a fresh spotlight on governance risks in the country.

Shares of Yunnan Energy New Material Co. plunged by as much as the 10% daily limit in Shenzhen for two consecutive days after the Chinese maker of paper packaging and lithium battery films unveiled its chairman and vice chairman were under police surveillance. The company said the probe was related to an unidentified matter, without elaborating, and that its operations remained normal.

The two-day selloff has erased more than $1.3 billion in wealth for the ...