Bottled-drink company Fiji Water said it reopened its bottling facility in the South Pacific country for which it is named, ending a two-day standoff with the local government over taxes.
The company, which is owned by billionaire investors Lynda Resnick and Stewart Resnick, closed the facility Monday, sending about 400 workers home. The shutdown came in response to a move by Fiji’s 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.
On Tuesday, 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 increase and reopened the plant Wednesday at 8 a.m. local time.
“Fiji Water is committed to working with the Fijian government and remains dedicated to helping the country’s economy and its people,” company 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 increase.
Fiji Water, which was started in 1996 by Canadian businessman David Gilmour, has close 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 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 2004from 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.