U.S. Markets closed

Smurfit Kappa says to protect interests after Venezuela plant seizure

DUBLIN (Reuters) - Packaging company Smurfit Kappa Plc (SKG.I) on Wednesday confirmed the temporary seizure of its Venezuelan plant by the government and the detention of two employees and said it would work to protect the interests of its stakeholders.

Venezuela's state price control agency Sundde on Aug. 21 announced that the government had seized the plant and two days later said two managers at the plant had been arrested.

Sundde said the people had been charged with price speculation, boycotting, destabilising the economy, and smuggling, and ordered the firm to immediately adjust its prices for all its products and accused the company of refusing to sell to certain local businesses.

Smurfit, which has operated in Venezuela since 1986, last week refuted all allegations which it described as without merit, but it did not immediately confirm the seizure or the arrests.

In its statement on Wednesday, Smurfit confirmed the government had taken control of Smurfit Kappa Carton de Venezuela for 90 days and said the company was making all possible efforts to secure the release of its two employees.

The company, it said, had always operated to the highest business and ethical standards and had developed a "highly progressive" Corporate Social Responsibility programme.

But it said it could not take responsibility for the use of its installations or its employees’ safety while the plant was in government control.

"In the event that the announced action continues, Smurfit Kappa Group is fully committed to protecting the interests of its stakeholders," it said.

(Reporting by Sangameswaran S in Bengaluru and Conor Humphries in Dublin; Editing by Jane Merriman and Mark Potter)