Moscow has taken charge of the Russian subsidiaries of Danone and Danish brewer Carlsberg.

The Kremlin said on Sunday (16 July) it had placed the foreign-owned stakes of both Danone Russia and Baltika Breweries under the “temporary management” of government property agency Rosimushchestvo.

Both Danone and Carlsberg were in the process of selling their operations in Russia.

Vladamir Putin introduced legislation in April to allow the seizure of assets belonging to businesses from companies Russia deemed “unfriendly”. Germany’s Uniper and Finland’s Fortum were placed under state control in April.

Many foreign companies ceased operations in Russia following Moscow’s decision to invade Ukraine in February 2022.

A spokesperson Danone said last night: “Danone is preparing to take all necessary measures to protect its rights as shareholder of Danone Russia, and the continuity of the operations of the business in the interest of all stakeholders, in particular its employees.”

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By GlobalData

The Evian brand owner said in October last year that it would shed its dairy and plant-based business in Russia.

The company added the decision to seize the unit would have no impact on its financial guidance for 2023.

Danone Russia is the country’s largest dairy company, and has around 8,000 employees. The company has previously indicated the sale of its business would result in a hit of up to €1bn ($1.1bn).

Carlsberg, meanwhile, also has more than 8,000 employees in Russia and produces domestic beer brands including Baltika. It has eight production breweries in the country.

The Tuborg brewer issued a statement on Sunday stating it had “not received any official information from Russian authorities regarding the presidential decree or the consequences for Baltika Breweries”.

Carlsberg, which last month announced it had found a buyer for its Russian business, added it found the development “unexpected” and would assess the “legal and operational consequences” of Russia’s actions.

“Following the presidential decree, the prospects for this sales process are now highly uncertain,” the Danish brewer said. “The group is in the process of obtaining more detailed information and will publish any relevant and verified information, including potential financial implications, as soon as possible.”

Finalising the sale of the business in Russia is one of the items on the agenda for CEO Cees t’Hart ahead of his retirement later this year.