Heineken has finalised the divestment of its operations in Russia, a transaction 17 months in the making.
The sale, the process of which started in March last year, will see the group’s seven breweries in the country come under the control of Arnest Group, a household products company based in south-west Russia. Arnest will pay Heineken a token EUR1 for its assets, along with around EUR100m of historical debt owed by the Russian division to the Amsterdam-headquartered group.
Heineken will book a EUR300m [US$325.2m] writedown from the offload and the company reaffirmed it has “no call option” on the sale that would allow a return to Russia.
CEO Dolf van den Brink conceded the exit had taken “much longer than we had hoped”, but welcomed the successful completion, an outcome that has eluded brewing rival Carlsberg: The Danish company, which was Russia’s beer market leader, saw its operations transferred by presidential decree last month, prior to a pre-announced sale of its own.
“Recent developments demonstrate the significant challenges faced by large manufacturing companies in exiting Russia,” said van den Brink, hinting at Carlsberg’s travails. “This transaction secures the livelihoods of our employees and allows us to exit the country in a responsible manner.”
In results for the first six months of this year, reported in July, Heineken’s total sales were up 6.6% year-on-year although came in “below [company] expectations”.
How can no- & low-alcohol beer realise its much-vaunted potential? – Category Intel
