Russia: places Danone + Carlsberg under external management

Bremerhaven / DE. (eb) This week, the examples of Danone Russia and Carlsberg Russia show what can happen if Western companies hesitate too long to leave the lucrative market: On Monday, the French Danone Group informed about the decision of the Russian authorities to place Danone Russia under the external administration of the Federal Agency for State Property Management «Rosimushchestvo» for the time being. The Group is preparing to take all necessary measures to protect its rights as a shareholder of the Russian subsidiary and the continuity of business operations in the interests of all stakeholders – whatever that may mean. According to the Group, the Russian decision should have no impact on Danone’s financial forecast for 2023. According to, Danone Russia has 16 plants and a dairy farm in the Russian Federation that produce traditional dairy products, yogurts and desserts.

Update from on July 16, 2023 (sometimes only in bullet points): New investments in Russia suspended and transfer announced: Danone Russia is looking for a new operator for its dairy plants and dairy livestock. According to January-September 2022 results, Danone’s global sales grew 14.9 percent y-o-y to 20.7 billion EUR, with dairy and plant-based beverage business in the Russian Federation accounting for about five percent. Still operating in Russia, with increasing sales volumes in 2022 compared to 2021 (up USD 29 million or 11 percent) according to Russian Accounting Standards and Federal Tax Service of Russia data, which excludes IFRS adjustments and intercompany eliminations. In the Group’s annual report prepared in accordance with IFRS, Russia’s share of gross income is USD 1.5 billion (six percent of the total). Recent development: Russia places the subsidiary under external management.

By presidential decree, in addition to Danone Russia, the Baltika breweries of the Danish Carlsberg Group are also temporarily under Russian state administration

The Presidential Decree published on July 17, 2023, also temporarily transferred the Baltika breweries of the Danish Carlsberg Group to the State Property Administration «Rosimushchestvo». The Danes received no official information from the Russian authorities about the decree or its consequences for the Baltika breweries. According to the Group in Copenhagen, Carlsberg is not aware of any misstep and had acted in accordance with local rules and regulations in Russia. The step comes unexpectedly for them.

Of interest in this context:

The risks that continued business with Russia may hold are addressed in last week’s «FMCG – Business with Russia continues to flourish». Moreover, life is not all about tempting profit margins. This is reminded by «German SMEs in Russia – The Ruble Rolls, Doesn’t It?», which also appeared last week – and both only avaiable in German on backnetz:eu.

On March 28, 2022, the Carlsberg Group announced its intention to seek the complete sale of its Russian business. Following an extensive process to separate the business from the rest of the Group, an agreement to sell the Russian business was signed on June 23, 2023, subject to regulatory approvals and the satisfaction of certain conditions in a number of jurisdictions. Following the presidential decree, the prospects for this process are now highly uncertain. The Group is in the process of obtaining more detailed information and will publish all relevant and reviewed information, including potential financial impacts, as soon as possible.

According to, Carlsberg’s subsidiary business in Russia is on track for increasing sales volumes in 2022 compared to 2021 (up USD 361 million or 28 percent). Carlsberg Group plans to sell its Russian business. Moscow is now seizing Danone and Carlsbergs Russian subsidiaries.

Update from on June 23, 2023 (sometimes only in bullet points): Will exit the Russian market and take a significant non-cash impairment charge. June 03, 2022: Renamed «Carlsberg Vostochnaya Europa» LLC to «Hoppi Union» LLC. Reluctant exit from the Russian market. Carlsberg signed an agreement to sell its Russian business on June 23, 2023. Moscow seized Carlsberg’s Russian subsidiary Baltika on July 17, 2023.