Business

Heineken to pull out from Russia in €400mn hit

Heineken will end its operations in Russia, in a move that will cost the Dutch brewery 400 million euros and pressure rivals to follow suit.

The world’s second-largest brewer announced on Monday that it would transfer its Russian business to a new owner and that it would not profit from the deal.

Heineken’s Russian business accounts for 2% of its global sales. While other international brewing companies have reduced activity in Russia, Heineken is the first to announce plans to leave the country and one of the few consumer companies to have done so.

The company said its ownership of the business in Russia “is no longer viable and unsustainable in the current environment. As a result, we have decided to leave Russia.”

He added: “We will not benefit from any transfer of ownership and we expect a decrease in value and other non-cash charges in the amount of about 400 million euros in total.”

Businesses with a large number of employees in Russia have faced difficult decisions regarding their safety and future employment. Heineken said its 1,800 employees would be paid by the end of 2022, adding that the company “will do its utmost to maintain their future employment.”

While Heineken’s exposure to Russia is small, Danish competitor Carlsberg makes up about 9% of its sales in the country. It announced that its Baltika breweries would be run separately, “with the aim of sustaining our employees and their families.”

The price of the Heineken stock, traded in Amsterdam, remained almost constant after the announcement. Shares fell 11% this year.

Heineken to pull out from Russia in €400mn hit Source link Heineken to pull out from Russia in €400mn hit

Related Articles

Back to top button