Australian wine group Southcorp's woes multiplied on Wednesday as its shares plunged further - 25% in two days - and it was revealed Australia's corporate policeman had started legal action alleging a breach of continuous disclosure obligations.

The Australian Securities and Investments Commission (ASIC) said it had filed court proceedings. The charges are civil, not criminal and relate to an e-mail sent to selected sharemarket analysts about forecast earning for financial 2003 in April last year.

The ASIC sees the action as test case.

Southcorp's horror week, which began with a share trading halt and then a 97% profit downgrade which has written off A$788m (US$476m) from its market value, continued with the fall in its share price to A$3.35 (US$2.01) on Wednesday.

Southcorp said that it was made aware that ASIC had commenced court proceedings.

"Southcorp continues to maintain that it has not breached its disclosure requirements as a publicly listed company," it said.

"It is not appropriate for the company to make any further comment on this matter beyond that it will strenuously defend its position."

Under the Corporations Act, Southcorp could be fined up to A$200,000 (US$120,000) if it is found guilty.

On top of the ASIC decision, Standard & Poor's dropped Southcorp's credit rating a level to BBB.