Epilogue for Danone’s exit from Russia: the French agri-food giant announced, Friday March 22, that it had obtained “required Russian regulatory approvals” to sell its subsidiary in Russia to a businessman linked to the Chechen leader, Ramzan Kadyrov, over which it had already lost control.
This transfer of its activities “dairy and plant products” to the company Vamin R LLC – known as Vamin Tatarstan –, a Russian dairy company owned by Mintimer Mingazov, linked to Ramzan Kadyrov, “is expected in the coming weeks”Danone said in a press release.
Since the offensive in Ukraine which began on February 24, 2022 and the first economic sanctions decreed by the West, many multinationals have left Russia and others have suspended their activities there, in the oil and automobile sectors. or even luxury.
The company was established in the early 1990s
Danone took more than seven months after the invasion to launch the process of transferring its activities to the country, where the group, then named “BSN”, had been among the first multinationals to settle in August 1992, a few months after the collapse of the Soviet Union. Danone marketed milk and yogurts there under the Danone, Danissimo and Prostokvachino brands. In 2010, the group purchased 57.5% of the number two Russian dairy products company, Unimilk (21% market share and 25 factories), with the ambition of strengthening its presence on this market. The country represented around 5% of Danone’s global turnover.
In July 2023, Russia published a decree giving control ” temporary “ of Danone’s Russian assets to the Federal Agency for Russian State Property Management, a decision that Moscow had presented as a reaction to sanctions hitting Russian companies abroad. This seizure, like that of the Russian division of the Danish beer manufacturer Carlsberg, provoked strong protests in the West. A nephew of Ramzan Kadyrov, Iakoub Zakriev, 32, was then appointed general director of the Danone subsidiary, and the company was renamed “Life and Nutrition”.
Then President Vladimir Putin, of whom Ramzan Kadyrov is a close ally, signed, on March 13, 2024, a new decree canceling the control of Danone’s assets by the Russian state, without the Kremlin providing an explanation. “In July 2023, realizing that it no longer held management control, Danone deconsolidated its EDP Russia activities. The total loss recognized by Danone in its accounts amounts to 1.2 billion euros”it is added in Friday’s press release.
Citing a document sent to the Russian Ministry of Agriculture and anonymous sources, THE Financial Times recently estimated the transaction for 17.7 billion rubles (177 million euros), or a fraction of the value of the subsidiary.