Smurfit Kappa to 'vigorously appeal' €124m Italian price-fixing fine

Shares in paper and packaging group Smurfit Kappa fell marginally after it was hit with a €124m fine by Italy's competition authority over alleged price-fixing; a move which the company said it will "vigorously" appeal.

The Irish-based group's Italian subsidiary Smurfit Kappa Italia is one of around 50 companies - including fellow industry heavyweights DS Smith and International Paper - accused by Italy's competition regulator of "anti-competitive practices". The result comes after a two-year probe into the sector.

Smurfit Kappa said it was "very disappointed" with the ruling "on many levels" and said it will "vigorously appeal" the decision on both administration and substantive grounds. However, it said the appeal process will take "a number of years".

In the meantime, the group will pay the fine this year and take the cost as an exceptional charge in its annual accounts.

"SKG is committed to the highest standards of conduct in its business and will not tolerate any actions that are inconsistent with its values," Smurfit Kappa said.

The group's shares - which have fallen by around 26% in the last 12 months - dropped by just over 1.5% after the Italian ruling announcement.

Last week Smurfit Kappa reported a 4% rise in revenues for the first half of the year, to €4.62bn and a 9% jump in pre-tax profits to €456m.

Exceptional costs in the first half of the year amounted to just €3m, Smurfit Kappa said in its interim results.