#header-inner img {margin: 0 auto !important; #header-inner {text-align: Center ;} Fiji Coupfourpointfive: Fiji Water reopening follows its lawyers meeting with regime

Wednesday, December 1, 2010

Fiji Water reopening follows its lawyers meeting with regime

By Lauren A.E. Schuker for the Wall Street Journal

Bottled-drink company Fiji Water said it reopened its facility in the South Pacific country for which it is named, following a two-day standoff with the local government over taxes.



Fiji Water, which is owned by billionaire investors Lynda Resnick and Stewart Resnick, closed its bottling plant Monday, sending about 400 workers home, in response to a move by the Fiji government to impose a steep tax increase on companies that extract large volumes of water from the country. Fiji Water was the sole company affected by the increase.


Over the past day, Fiji Water lawyers Craig Cooper and Marigold Moody met with Fiji government officials, including Prime Minister Voreqe Bainimarama, seeking to resolve the dispute. After the meetings, Fiji Water agreed to accept the tax increases and reopened the plant 8 a.m. local time on Wednesday.



"Fiji Water is committed to working with the Fijian government and remains dedicated to helping the country's economy and its people," the company's president, John Cochran, said in a statement.



Earlier this week, Commodore Bainimarama, who came to power in a 2006 coup, said he would welcome a rival taking over Fiji Water's assets if the company refused to comply with the government's tax increases.



Fiji Water, which was started in 1996 by Canadian businessman David Gilmour, has deep ties to Fiji. Its water comes from an artesian aquifer in the Yaqara Valley, a remote part of Fiji's main island. Almost all of the company's workers are Fijians.



On Monday, the company idled those employees, saying it would pay them two weeks' salary. However, it said it has called them back to work for Wednesday's re-opening.



Fiji Water accounts for about 2% of the $10.6 billion U.S. bottled-water market, making it one of the biggest imported waters in the U.S.



The Resnicks' holding company, Roll International Corp., bought Fiji Water in 2004 from Mr. Gilmour, who also founded a resort in the country. Fiji Water's sales rose to $141 million in 2008 from $78 million in 2005 but fell last year to $85 million.

9 comments:

Anonymous said...

Considering the success of Fiji Water in the US and around the world. I was a bit sceptical about aborting the operation in Fiji. Even a 20% tax would still work for Fiji Water. They have to resist to make it look like a genuine rebelious move but Ayass is smart. The only problem is more money in their pockets bloody IG.

Anonymous said...

Why do I have the feeling that this is not the end of the story? With decreasing sales of Fiji Water in the US market (2009 production was only half the 2008 output) it might make a lot of sense for Fiji Water to stick to the 3.5 million liter limit and avoid the tax increase.

Bauhaus. said...

Gee - todays 2 main papers carried interesting insight into both their roles in this current politically charged climate.

Alleged military alligned FS simply stated "following discussions Fiji Water will
re open".

Despite yesterday completly ignoring breaking story regarding Fiji Waters threat to close down & leave - former anti regime Fiji Times to day proclaimed "Fiji Water caves in to demands".

Quite a role reversal in any language.

Can only hope NewsCorp patriach & his underlings are keeping a close eye on whats going on?

One things certain - current lessee
seems determined to carve his own unique chapter into this Mastheads long & colorful history.

Anonymous said...

Sounds great of Fiji to repay Fiji Water $4-$5 million of VAT. The fact of the matter is that FIRCA takes this money from Fiji Water in the first place and then repays it months later. It is a loan from Fiji Water to Fiji. They are supposed to repay Fiji Water within 30 days but never do. Another reason for investors not to invest in Fiji.

Anonymous said...

what does jake think of all this? he can usually put a good spin on things

TheMax said...

Jake is cleaning Bai's dog house.

Anonymous said...

Is Fiji water just building up inventory so that they can move to NZ soon and tell Bainimara to go to hell

Jake said...

What started out as pretence that the corporation’s position is stronger than it really is ended with an embarrassing back down for the man stood his ground?

One cannot out fox an old fox.

For every Fijian born post 1970 and those yet to see the light of day ought to thank their lucky stars they have a true and equitable leader at the helm.

Bainimarama is still alive and doing very well.

Jake

Anonymous said...

Of course Fiji Water would reopen, they are raking in millions. It really is money for nothing for them. These people are billionaires...They WILL NOT close their money making machin. John Cochran talks about caring for the people of Fiji and it's economy..all they are caring about is filling their own pockets.
So is Frank..hopefully the 15% tax will go towards the econmy and its people as opposed to lining Frank and his cronies pockets.