Reuters International

FILE PHOTO: A factory of Shanshui Cement is seen in production in Liaocheng, Shandong province, April 1, 2004. REUTERS/China Daily/File Photo

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HONG KONG (Reuters) - China Shanshui Cement Group Ltd said its executives were attacked with pepper spray, smoke bombs and water guns and then held for two hours by associates of a former official when they tried to retake control of company property.

According to the Securities Times newspaper, Shanshui Cement executives organised a crowd of around 600 people, wearing red arm bands, white gloves and wielding sticks and axes, to storm and gain control of a company facility in the city of Jinan.

The abnormally hostile corporate battle is the latest development in current management's dispute with former deputy general manager Mi Jingtian. Accusing him of "suspected misconduct", the company said in December it had suspended Mi from his duties at unit Shandong Shanshui and all its subsidiaries.

Shanshui Cement said in its filing on Monday it had appointed legal advisers to take action against Mi and his associates over what it described as an illegal occupation and criminal action.

Mi could not be reached for comment. It was not known if he has retained a lawyer.

Photos run by business website Sina.com showed smoke billowing from a facility described as the Shanshui Cement plant.

An employee at the affected Shanshui Cement facility who answered the phone told Reuters there had been a confrontation. The employee, who declined to identify himself, also said that Mi had 'acted lawfully'.

Jinan police could not be reached for comment. Other contact numbers for Shanshui Cement, either in Jinan or Hong Kong could not be obtained.

Shares in Shanshui Cement have been suspended since April 2015 as its public float fell below the 25 percent minimum level required after Tianrui Group raised its stake to become the company's biggest shareholder. A Tianrui representative was not immediately available for comment.

At the end of February, its unit Shandong Shanshui Cement defaulted on a 1 billion yuan (£118 million) bond.

(Reporting by Donny Kwok and Umesh Desai in HONG KONG, Adam Jourdan and SHANGHAI NEWSROOM; Writing by Anne Marie Roantree; Editing by Edwina Gibbs)

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