Heineken will end its operations in Russia, in a move that will cost the Dutch brewer €400mn and pressure rivals to follow suit.
The world’s second-largest brewer said on Monday it would transfer its Russian business to a new owner and that it would not profit from the transaction.
Heineken’s Russian business represents 2 per cent of its global sales. While other international brewing companies have reduced activities in Russia, Heineken is the first to announce plans to exit the country and one of few consumer companies to do so.
The company said its ownership of the business in Russia “is no longer sustainable nor viable in the current environment. As a result, we have decided to leave Russia.”
It added: “We will not profit from any transfer of ownership and we expect an impairment and other non-cash exceptional charges of approximately €400mn in total.”
Businesses with large numbers of employees in Russia have faced difficult decisions over their safety and future employment. Heineken said its 1,800 employees would be paid until the end of 2022, adding that the company “will do our utmost to safeguard their future employment”.
While Heineken’s exposure to Russia is small, Danish rival Carlsberg makes around 9 per cent of its sales in the country. It has announced that its Baltika Breweries will be run separately, “with the purpose of sustaining our employees and their families”.
Amsterdam-listed Heineken’s share price remained largely flat after the announcement. The shares have fallen 11 per cent this year.
(…)
______________________________________________________
You can read this complete story at: https://www.ft.com/content/cd344ba7-eed4-45dc-858f-4ec423145c55
