Kremlin Seizes Nestlé's Russian Assets Amid Ongoing Crackdown on Foreign Companies
The Kremlin has taken control of Nestlé’s business in Russia, transferring its assets to a firm called LEV Management. This move follows a presidential decree allowing Moscow to place foreign-owned companies from 'unfriendly' nations under temporary administration since the start of the Ukraine war in 2022. Nestlé said it is assessing options and will take steps to protect its rights and ensure business continuity, particularly for employees. Nestlé has six factories in Russia producing coffee, pet care products, and infant formula, with sales amounting to about 2 billion Swiss francs (£1.8bn) in the last reported year (2021). Analysts suggest that while there is a risk of losing these assets—accounting for around 1% of Nestlé’s global sales—the financial impact may be limited due to reduced operations and suspended investments. This action aligns with previous seizures, including those affecting Danone and Carlsberg. The move has caused Nestlé shares to fall by 1.7%, reflecting investor concerns over the potential loss of assets in Russia.
Topics: corporate_governance foreign_investment international_relations