Russia seized the local assets of Carlsberg beer and yogurt maker Danone. It now threatens Austria’s Raiffeisen bank.
Russia Seizes Western Yogurt and Beer
President Vladimir Putin signed a decree in April allowing for “temporary” state control over the assets of companies or individuals from “unfriendly” states — which include the US and its allies.
Sunday’s move is the second time the Kremlin has used the decree to seize assets. Previously, Russia took control of utilities owned by Finland’s Fortum Oyj and Germany’s Uniper SE.
Russia and Ukraine accounted for about 13% of Carlsberg’s total sales and about 9% of operating profit in 2021. The company employs about 8,400 people in Russia and had previously separated the operations there from the rest of the group.
Carlsberg is assessing the legal and operational consequences. Fortum last week started a process of arbitration over the April seizure. But with Russia no longer concerned about appearing fair to western investors, it’s difficult to see how much recourse these or any other multinationals will have.
Procter & Gamble, Colgate-Palmolive and Philip Morris International have also remained. Coca-Cola HBC has the largest revenue exposure to Russia among European consumer-staple companies, Morgan Stanley said, saying the regional Coke bottler gets 12% of sales from that market.
Troubles at Raiffeisen Bank
After Russia took over Danone and Carlsberg, what fate is awaiting Austria’s Raiffeisen bank? The US and EU’s banking authorities pressure the bank for some time now to exit Russia, but progress is slow and risks are getting higher. After some failed attempts to swap assets with Russian banks in Europe, Raiffeisen is stuck between the rock and a hard place…
…click on the above link to read the rest…