Cargill Says Plant Is Under Armed Occupation in Eastern Ukraine

Jul 10, 2014 5:14 pm ET

July 11 (Bloomberg) -- Cargill Inc. suspended operations at a sunflower-oil plant in the Donetsk region in eastern Ukraine, where the government is battling pro-Russian separatists, and said the facility has been occupied by armed individuals.

The plant was shut July 4 because of an “escalation of tension in the region,” Anastasia Dudley, a spokeswoman for Minneapolis-based Cargill, said yesterday in an e-mail.

“The plant has subsequently been occupied by a small number of armed individuals whose intentions are not clear to us,” Dudley said.

There are no company employees currently at the site and it’s unclear when it will restart, she said.

Ukrainian forces are advancing after rebels shifted thousands of fighters to the provincial capitals of Donetsk and Luhansk, Andriy Parubiy, head of the country’s national security and defense council, said July 9. As many as 100,000 inhabitants have fled the city of Donetsk in recent weeks, according to the mayor’s office.

Cargill, the largest closely held firm in the U.S., has been present in Ukraine for 21 years. It has more than 700 employees in Ukraine, according to its website.

Cargill bought a 5 percent stake in UkrLandFarming Plc, Ukraine’s biggest agricultural company, for $200 million in December. UkrLandFarming Chief Executive Officer Oleg Bakhmatyuk said July 1 that he postponed a planned initial public offering for his company because of political violence in Ukraine.