Heineken has completed its lengthy exit from Russia with the sale of its operations there for a symbolic €1, after Moscow clamped down on asset sales in retaliation for western sanctions.
The Dutch brewer, which also owns the Amstel, Birra Moretti and Tiger brands, said it would be taking a €300m loss as a result of the sale, which will see it transfer all of its remaining assets, including seven breweries, to Russia’s Arnest Group.
The multinational brewer, which also owns UK craft brewer Beavertown, faced criticism for the slow pace of its exit in the wake of the invasion of Ukraine, but had insisted it was seeking to look after its 1,800 employees in Russia.
Arnest Group owns a major can packaging business and is Russia’s largest manufacturers of cosmetics, households goods and metal packaging for the fast-moving consumer goods sector.
Arnest has agreed to guarantee the employment of Heineken’s local staff for three years as part of the deal, which the Dutch company said “took much longer” than hoped.
“We have now completed our exit from Russia,” Heineken’s chief executive and chair, Dolf van den Brink, said. “Recent developments demonstrate the significant challenges faced by large manufacturing companies in exiting Russia. While it took much longer than we had hoped, this transaction secures the livelihoods of our employees and allows us to exit the country in a responsible manner.”
Heineken announced in March 2022 that it was quitting Russia, saying the business there was “no longer sustainable nor viable in the current environment”, but added it wanted to ensure an “orderly transfer” to a new owner.
Western companies have been hampered by rules, introduced by the Kremlin last year, that force firms to get approval from Russia’s finance ministry before selling any assets. The process can take anywhere from six to 12 months, and can be more burdensome for key sectors like oil and banking, which need personal approval from the president, Vladimir Putin.
Last month, the Russian state took control of rival Carlsberg’s stake in a local brewer, after a decree by Putin. The decree stated that the government would “temporarily” manage the shares belonging to the Baltika brand.
Carlsberg had announced in March that it planned to sell the entirety of its operations in Russia, where it employed 8,400 people. By June, the brewer said it had found an unnamed buyer for the business, more than a year after announcing its exit from the market due to the conflict in Ukraine. However, following the presidential decree, Carlsberg said the sale was “highly uncertain”.
“The Carlsberg group has not received any official information from the Russian authorities regarding the presidential decree or the consequences for Baltika Breweries,” the company said last month.
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Heineken exits Russia with €1 sale of operations - The Guardian
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