A reporter is wanted by the police in east China's Zhejiang Province on suspicion of defamation after publishing stories accusing a public company of illegal transactions, local police said Wednesday.

Qiu Ziming, a reporter of Economic Observer News, a Chinese economic newspaper, is wanted by the police of Suichang County, Lishui City, Zhejiang, after he was accused of defaming Zhejiang Kan Specialty Material Co., Ltd. (Kan).

"As an enlisted company, Kan is obliged to reveal information to the public. We strongly protest its attempt to suppress media supervision and violate reporters' rights," Economic Observer News wrote in a statement.

The statement added that the staff of the newspaper were shocked by the news that Qiu was wanted by police and were worried for his and his family's safety.

Kan suspended public transactions on June 7 after Qiu's stories were published. Its half year financial report released in July showed the company had made profits of 53.34 million yuan in the first six months of 2010, up 205.8 percent year on year.

"The stories were false and severely damaged our company's reputation," said Wang Bailang, Kan's president.

"We resorted to the police after communication with the reporter broke down," Wang added.

"The government and police will deal with the case transparently and strictly in line with the law. We welcome supervision from the media and public," said Ge Xuebin, head of Suichang County.

Economic Observer News has reported the case to the General Administration of Press and Publication.