Orora shares rally after Saverglass competition concerns eased
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More news: Orora shares jumped in early trading after the packaging group assured investors that "appropriate business practices have been followed" at its European subsidiary Saverglass amid an industry-wide regulatory investigation in France.
Orora shares were up 4.4% to $1.88 at 10:40am AEDT. They slumped 8.4% on Friday after the group announced that Saverglass is one of the subjects of a regulatory review of the French beverage glass container industry.
Orora plays down regulatory probe into Saverglass
The news: Packaging group Orora has played down the role of its subsidiary Saverglass in "potentially anticompetitive practices" after the French Competition Authority visited its office last week as part of a wider investigation.
The numbers: Orora shares plunged 8.4% to $1.80 on Friday after the company announced that its European bottler maker Saverglass is one of the subjects of a regulatory review of participants in the French beverage glass container industry.
The context: Orora said it understands that the investigation relates to a period prior to Orora's acquisition of Saverglass in 2023.
The group noted that this period was marked by major events including the Covid pandemic and the start of the war in Ukraine, which led to input costs for class container production including energy, key raw materials and gas "increasing significantly", as well as increased freight costs due to "very high inflation across Europe".
Orora said that "only a small number" of customers that complained about price increases are customers of Saverglass, representing "minor trading relationships".
It also flagged that visits by the regulators to a number of companies' offices last week "does not prejudge the guilt of the companies concerned by the alleged practices."
What they said: "The Saverglass leadership team is confident appropriate business practices have been followed, operating independently from other glass packaging manufacturers," Orora said.
The source: ASX
