Owens-Illinois Declines After Chavez Orders Unit Expropriation

Tuesday, 26 Oct 2010 10:12 AM

 

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Owens-Illinois Inc., the Ohio-based glass manufacturer, fell the most in three months in U.S. trading after Venezuelan President Hugo Chavez said he ordered a government takeover of its local unit.

Owens-Illinois, the world’s largest producer of glass containers, declined $2.11, or 7.1 percent, to $27.51 at 9:32 a.m. in New York Stock Exchange composite trading, after touching $26.86, for the biggest intraday drop since July 29. The shares had declined 9.9 percent this year before today.

“The expropriation is already ready of this glass company,” Chavez said in comments carried on state television late yesterday. “What’s it called? Owens-Illinois. Expropriate it.”

The nationalization is one of several since Chavez’s party suffered a setback in legislative elections on Sept. 26 and Chavez promised to deepen his socialist revolution. Perrysburg- based Owens-Illinois is on a list of companies the government plans to take over, Chavez said. The manufacturer “has been exploiting workers,” he said.

Owens-Illinois said in an e-mailed statement today it was “surprised” to learn of the decision and willing to work with the government “to better understand the situation.”

The company said it operates two plants in Venezuela in Los Guayos and Valera that employ 1,000 people and account for less than 5 percent of global segment operating profit.

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