Colgate Palmolive sale row still on in NepalDecember 11th, 2008 - 2:20 pm ICT by IANS
Kathmandu, Dec 11 (IANS) Three weeks after oral care giant Colgate Palmolive India sold its Nepal arm to local company Everest Hygiene Products, the new owner has not been able to restart the factory due to continued protests by the employees. Local media Thursday reported Madan Neupane, leader of the labour union at the factory of former Colgate Palmolive Nepal in Hetauda town in central Nepal’s Makwanpur district, had said the workers were waiting for the Indian company to send a representative to discuss their grievances.
According to reports, workers are demanding a severance package, job guarantee and other incentives.
Last month, when Colgate Palmolive India informed the Bombay Stock Exchange about the divestment, it also added that it had signed a contract manufacturing agreement with Everest Hygiene Products to continue to source toothpowder from the Hetauda factory, “thus providing for continuity of operations at the plant and exports from Nepal”.
It had also said that all employees of the divested Nepal subsidiary will “continue their employment on the existing terms and conditions under the new ownership”.
Despite the assurance, there is growing fear among the workers that the new owner may not continue operations but utilise the sprawling premises for lucrative real estate operations.
Everest Hygiene Products had told IANS soon after the sale in November that it was ready to resume operations as soon as the workers’ trouble was sorted out by the exiting Indian company.
The announcement of the sale in Mumbai last month triggered protests in Hetauda with workers detaining the representatives of the new owner inside the factory for 48 hours.
Meanwhile the youth wing of a leading political party prevented two top officials of Colgate Palmolive Nepal from catching a flight and handed them over to police alleging fraud.
Police, however, escorted the two officials to the Indo-Nepal border soon after the row.
After operating in Nepal for over a decade, the Indian company is said to have pulled out because of the continued lack of security.
In 2005, following widespread unrest after the then king Gyanendra seized power with the backing of the army, the company closed its toothpaste factory in Hetauda and shifted it to India.