Heineken Exits Russia with Sale of Business for Symbolic Price
In a surprising move, Heineken has announced its departure from Russia after selling its business in the country for a mere 1 euro (1 dollar). The Dutch beer maker stated on Friday that it had received the necessary approvals to sell its operations to Arnest Group, a Russian brewer, thus completing a withdrawal process that began in March 2022.
Heineken’s CEO, Dolf van den Brink, acknowledged the challenges faced by large manufacturing companies when exiting Russia. “Recent events demonstrate the significant challenges large manufacturing companies face in getting out of Russia. Although it has taken much longer than we expected, this transaction ensures the livelihood of our employees and allows us to leave the country responsibly,” he said.
However, this business move comes at a cost. Heineken expects to incur a total loss of 300 million euros ($323 million) on the deal. The situation worsened for Western companies wanting to sell off their Russian assets after Moscow launched its full-scale invasion of Ukraine in February 2022. The Kremlin has made it increasingly difficult for multinational companies to exit Russia, imposing hefty fees for such transactions.
In March, Heineken had expressed its determination to prevent its Russian businesses from being nationalized while leaving the country as soon as possible. The company highlighted its concerns about the Russian state’s intentions and the profiting from the seizure of important business assets.
As part of the sale, Arnest Group, a company known for producing cosmetics, household items, and metal packaging for consumer goods, has offered job guarantees for the next three years to Heineken’s 1,800 employees in Russia.
Heineken’s departure from Russia reflects the challenging business environment created by recent geopolitical events. The brewery’s decision to complete the sale for a highly symbolic price demonstrates a commitment to its employees and responsibility in leaving the country.