Moscow takes control of Russian subsidiary of Danone and Carlsberg's stake in brewer

Reuters
Sun, July 16, 2023

MOSCOW (Reuters) -The Russian state has taken control of French yoghurt maker Danone's Russian subsidiary along with beer company Carlsberg's stake in a local brewer, according to a decree signed by President Vladimir Putin on Sunday.

The decree said that foreign-owned stakes in Danone Russia and Baltika Breweries were being put under the "temporary management" of government property agency Rosimushchestvo.

It comes after the Russian subsidiaries of Germany's Uniper and Finland's Fortum were taken under state control in April.

The Kremlin warned at the time it could seize more Western assets on what it said was a temporary basis in retaliation for foreign moves against Russian companies abroad after Moscow sent thousands of its troops into Ukraine last year.

Carlsberg said in a statement late on Sunday it had "not received any official information from the Russian authorities regarding the presidential decree or the consequences for Baltika Breweries".

It added that the prospects for full disposal of its business in Russia were now highly uncertain. Carlsberg said in June it had signed an agreement to sell its Russian business, subject to regulatory approvals.

Danone said in a statement that it was investigating the issue, adding that the Kremlin's decision would have no impact on its financial guidance for 2023.

The French company said last October it was seeking a buyer for its dairy food business in Russia, in a deal that could lead to a write-off of up to 1 billion euros ($1.12 billion).

(Reporting by Caleb Davis and Darya Korsunskaya; Additional reporting by Louise Breusch Rasmussen in Copenhagen and Lavanya Sushil Ahire in Bengaluru; Editing by Andrew Osborn and Emelia Sithole-Matarise)