Copenhagen Carlsberg has severed all connections with its Russian operations and declined an agreement with the Russian government that would validate Moscow's confiscation of the assets, stated the brewery's newly appointed CEO on Tuesday. The Danish company had been attempting to divest its Baltika subsidiary in Russia since last year, joining numerous other Western firms that have withdrawn from the country following its invasion of Ukraine.
Carlsberg recently announced in June that it had discovered a buyer for its business. Surprisingly, Russian President Vladimir Putin promptly ordered the temporary seizure of Carlsberg's stake in the local brewer the following month. Jacob Aarup-Andersen, who assumed the position of CEO in September, firmly stated, "It is undeniable that they have unlawfully taken our business in Russia, and we will not assist them in appearing legitimate."
Carlsberg's presence in Russia included eight breweries and approximately 8,400 employees. Last year, the company experienced a write-down of 9.9 billion Danish crown ($1.41 billion) on Baltika. Despite limited communication with Baltika's management and Russian authorities since July, Carlsberg has been unable to discover a satisfactory resolution to the current situation.
The sale of Heineken beer in Russia has come to an end, with Dutch brewer Heineken announcing its withdrawal from the country. This move comes 18 months after Russia's invasion of Ukraine, and the company has sold its business in Russia for a mere 1 euro. The completion of this transaction was revealed on Friday, August 25, 2023. (AP Photo/J. David Ake, FILE)
J. David Ake/AP
Heineken sells Russian business for $1 as it completes exit
"We will not engage in any transaction with the Russian government that would, in any way, legitimize their illegal takeover of our business," he stated during a conference call with journalists, following the release of the company's quarterly earnings statement.
In response, Carlsberg took decisive action by terminating the license agreements for its brands in Russia earlier this month. These agreements had previously allowed Baltika to manufacture, promote, and sell all Carlsberg products in the country.
Aarup-Andersen stated that once these licenses expire, along with the grace period, the production of our products is no longer permitted. Although I cannot assure that this will happen, it is our anticipation.
