By BBC News World
Aug 26, 2023, 1:20 PM EDT
Heineken’s operations in Russia include ownership of 7 factories employing 1,800 workers. And yet, the Dutch brewery has decided to sell everything for 1 euro.
Heineken said it will suffer a loss of 300 million euros on selling the division, which is being transferred to Russian company Arnest, a maker of aerosol cans.
With this decision, the company will finally cease its operations in Russia, almost a year and a half after committing to do so.
Many Western companies left Russia when that country invaded Ukraine in February 2022.
Dolf van den Brink, CEO and Chairman of Heineken, said: “It has taken much longer than we expected.”
“[Pero] this transaction ensures the livelihood of our employees and allows us to leave the country responsibly,” he added.
And it is that thanks to this transaction, Arnest will take ownership of seven breweries paying only 1 euro, but also acquires the commitment to hire the 1,800 workers and keep them employed for the next three years.
Manufacturing of the Amstel beer brand will be phased out in six months, joining that of Heineken beer which the company says will be phased out in 2022.
“Recent events demonstrate the significant challenges large manufacturing companies face when exiting Russia,” van den Brink said.
brands that left
Last month, President Vladimir Putin seized Russian assets owned by Carlsberg and French yogurt maker Danone.
Earlier this week, the owner of the Domino’s Pizza franchise in Russia, DP Eurasia, said it would close its Russian stores and bankrupt the business.
The company said it would not even attempt to sell the operation due to an “increasingly challenging environment.”
Russia has been subject to a series of economic sanctions since its tanks entered Ukraine on February 24, 2022.
Many big names decided to shut down their operations immediately after the invasion. Others, like McDonald’s and Coca-Cola, faced pressure to finally get out of Russia.
There has also been ongoing criticism for those who have continued to do business in the country.
The Yale University School of Management has been tracking which companies have left and which have stayed. Among those left are companies such as British telecommunications company BT Group and Lacoste, the French luxury sportswear brand.
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