Owens-Illinois Inc. (OI) said the Venezuelan government was set
to take control of the glass-container maker's operations there on
Thursday morning.
Shares were down 2.2% at $27.43 in recent trading. The stock is
down 17% this year.
The company in a statement Thursday said an agreement with the
Venezuelan government hadn't been reached. Owens-Illinois has
operated in Venezuela for 52 years, and has two plants that make
bottles and containers for beer, drinks, food and liquor.
Venezuelan President Hugo Chavez late Monday announced the
expropriation of the local affiliate of the U.S.-based glass maker,
accusing it of causing environmental damage and exploiting its
workers. Owens-Illinois warned Wednesday the situation will likely
hurt its fourth-quarter results.
Chairman and Chief Executive Al Stroucken said the company is
concerned by Venezuela's plans to manage two of its plants without
the "appropriate level of expertise" in glassmaking. The company
also is concerned about "continuity of supply" to food and beverage
segments.
The Chavez administration has seized commercial operations of
various companies in recent years, alleging misdeeds and other
actions as the country's own economy continues to suffer. Some
blame that on government action.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481; Tess.Stynes@dowjones.com;