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Shares of French food group Danone fall after it closes Ukraine plant, suspends Russia investments -Breaking

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© Reuters. FILE PHOTO: French meals group Danone brand is seen on the firm headquarters in Rueil-Malmaison close to Paris, France, February 20, 2022. REUTERS/Gonzalo Fuentes

By Dominique Vidalon

PARIS (Reuters) – Shares in Danone fell 3% on Monday after the French meals group stated it was suspending investments in Russia and had closed one in every of its two factories in Ukraine, following Russia’s invasion of the nation.

Nevertheless, the world’s largest yoghurt maker, which introduced the measures on Sunday, stated it could proceed to promote dairy and child meals in Russia, its third largest market after France and Spain.

Danone’s new CEO Antoine de Saint-Affrique was amongst French bosses who met with President Emmanuel Macron on Friday to debate the state of affairs in Ukraine, an organization spokesman stated on Monday, including it was too early to evaluate the monetary impression of the selections introduced on Sunday.

Danone, which generates round 6% of its gross sales in Russia and Ukraine mixed, controls Russian dairy model Prostokvashino.

It employs 1,000 individuals in Ukraine and eight,000 in Russia.

Danone shares had already fallen 9.9% because the begin of this yr earlier than Monday’s decline.

Danone Basic Secretary Laurent Sacchi stated in an announcement on the corporate’s web site on Sunday that the corporate will proceed to observe the state of affairs in Ukraine, and would apply any choices made by the French authorities.

“Now we have determined to droop all funding initiatives in Russia however at the moment preserve our manufacturing and distribution of recent dairy merchandise and toddler vitamin to nonetheless meet the important meals wants of the native inhabitants,” he stated.

Danone is because of maintain a Capital Market Day on Tuesday when Saint-Affrique will give particulars of his turnaround technique for the group.

He changed Emmanuel Faber who was abruptly ousted as chairman and CEO final yr following clashes with some board members over technique and calls from activist funds for him to resign over the group’s lacklustre returns in contrast with some rivals.

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