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Highlights

  • French Competition Investigation Underway: Orora’s Saverglass plant was raided by regulators over historical price complaints.

  • Company Minimizes Liability: Orora argues that most price increases occurred before its 2022 acquisition of Saverglass.

  • Limited Exposure to Complaints: The company claims only a small portion of complainants were Saverglass customers.

Orora Ltd (ASX:ORA) has stated that a French regulatory probe into the country’s glass packaging sector is unlikely to significantly impact its operations, despite its ownership of Saverglass, a key player in the industry.

The investigation follows complaints from beverage manufacturers over price increases in the early-to-mid 2020s. French competition authorities made an unannounced visit to the Saverglass facility late last week as part of their inquiry into potential anti-competitive practices.

Orora’s Response to the Investigation

In a statement on Monday, Orora emphasised two key reasons why it believes the probe poses little risk to the company.

First, Orora only acquired Saverglass in 2022 and argues that most of the price hikes in question occurred before its ownership, meaning its liability in the matter is minimal.

Second, the company attributed the rising costs in the industry to external economic factors rather than corporate misconduct. It pointed to COVID-era supply chain disruptions, inflation, and soaring energy prices in Europe—exacerbated by Russia’s invasion of Ukraine—as the primary drivers of higher glass packaging costs.

Regulatory Process Could Take Years

Orora also noted that such investigations typically take years to unfold. The company reassured investors that standard contractual protections, including Warranty and Indemnity insurance, were in place when it acquired Saverglass in 2023.

“As it is very early in the process, it is not appropriate to comment further at this time,” Orora stated.

Limited Exposure to Complaints

While some of the complainants were customers of Saverglass at the time of the alleged price increases, Orora downplayed the potential financial impact.

“At this stage, it appears that only a small number of those are customers of Saverglass, representing minor trading relationships,” the company said, without specifying exact figures.