Italy's Riva Group to close plants after court seizes assets

Italy's Riva Group, owner of one of Europe's largest steel plants, has announced it will shut down almost all the companies it controls in the country after a court seized assets and wealth worth about €900m from the family-owned company.

Steel making and logistics operations in 13 companies owned by the Riva family, which employ almost 1,500 workers, will be halted from Thursday.

The Riva family been at the centre of a long-running court case opened by prosecutors alleging corruption and violations of environmental standards leading to deaths around its Ilva iron and steel plant in the southern port city of Taranto. The group has denied all the allegations.

Ilva, which produces about 30 per cent of Italy's steel output and employs 12,000 directly, will continue its activities under government supervision.

The decision to freeze all of the Riva family's Italian assets, including blocking current accounts, was taken by a judge based in Taranto on Monday. Assets confiscated include the family's shares in Alitalia, the Italian airline, worth about €70m.

Halting production at the companies was necessary as the seizures "impeded the normal cycle of company payments and do not allow (normal) operative and economic conditions", Riva said in a statement on Thursday.

A company representative said Riva would appeal against the court order "unexpectedly extended" to the whole group.

Meetings with the main unions at the companies have been scheduled. "[This is] an unacceptable result," said Marco Bentivogli, national secretary Fim, one of the biggest metalworkers unions. "We will not accept the umpteenth slur which damages workers that do not have any responsibility [for the case]."

The dispute came to a head in July last year when the court in Taranto ordered the partial closure of the Ilva furnaces amid health and environmental concerns and issued arrest warrants, including one for Emilio Riva, the 86-year-old founder of the group, which bought the Taranto plant in 1995.

Last month prosecutors asked the courts to indict Mr Riva on charges of tax fraud in a linked case. He has denied the charges.

The long-running controversy over the privately owned company - accused by prosecutors of causing deaths through pollution - has led to numerous clashes between the government and judiciary and to increasing concern over undermining investor confidence at a time of economic crisis.

Antonio Gozzi, chairman of Federacciai, the national steel association, criticised the judges' interference with freedom of enterprise. "The dramatic measure adopted and communicated today by Riva represents the result of a judicial fury without precedent," he said.

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