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Friday, September 22, 2023

Heineken’s Russian Ventures Sold Off for Merely 1 Euro

The move comes after Russia's invasion of Ukraine

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RUSSIA/UKRAINE: Dutch brewer Heineken is selling its division to Russian aerosol cans company Arnest, causing a €300 million loss. The move comes after Russia’s invasion of Ukraine, prompting Western companies to abandon their Russian operations. The process took longer than anticipated, according to Heineken’s Dolf van den Brink.

Arnest plans to buy seven breweries for one euro and hire 1,800 people for three years, ensuring the livelihoods of its employees. The company will also phase out the production of Amstel beer, which was discontinued in 2022, over a six-month period. The transaction is expected to be responsible and secure the livelihoods of its employees.

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Heineken’s Van den Brink identifies key obstacles for big manufacturing enterprises to leave Russia, including the confiscation of Russian assets by President Vladimir Putin and the recent announcement by Domino’s Pizza franchise owner that it will close its locations in Russia and declare bankruptcy.

A “more challenging environment,” according to DP Eurasia, is the reason it will no longer try to sell the business. Since Russian tanks entered Ukraine on February 24, 2022, Russia has been the victim of a series of economic sanctions.

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Following the invasion, many major brands, including McDonald’s and Coca-Cola, shut down, while those that remained have faced criticism. Yale University School of Management is monitoring companies’ departures and stays, with high-end French clothing company Lacoste and UK telecoms company BT Group remaining. Critics argue that those who remained have faced constant criticism.

Arnest acquired Ball Corporation’s Russian affiliate, a container manufacturer based in Colorado, in September. The sale included three factories producing aluminium cans for beer and soft drinks in Moscow, Leningrad, and Chelyabinsk regions. Arnest paid $530 million for the deal. This marks Arnest’s second acquisition of a Western company’s Russian affiliate.

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Also Read: Heineken grande premio de portugal


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