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Beer giants Heineken and Carslberg join exodus from Russia


Bartender in St. Petersburg holds a Carlsberg beer glass in his hand.

Alexander Demianchuk | Russia

Brewing giants Carlsberg HeinekenThey announced Monday that they were leaving Russia to join the exodus of Western businesses as Moscow is under increasing pressure after its invasion of Ukraine.

Volodymyr Zelenskiy, the President of Ukraine, has asked international businesses to abandon Russia’s market following the Russian launch of a special military operation against Ukraine last month.

Carlsberg, Western’s most vulnerable brewer to Russia, said that the exit would lead to a “substantial cash impairment charge” for this year.

Baltika is the biggest brewery in the country and the majority of its 27% market share.

Carlsberg explained that Carlsberg made the tough and immediate decision of seeking a complete disposal of Russia’s business. This was the best thing for the environment. We will be completely gone from Russia after the transaction is completed.

Shares of the company, which had fallen nearly a quarter in the past year, were 4.2% higher Monday. This is their highest day since November 2020.

Heineken is Russia’s third-largest brewer. It stated earlier that it was seeking an orderly transfer of its local business. This would reduce its operations in a period of transition to lessen the possibility of Russian nationalization.

Dutch beermaker, Afribres expects to record related charges in the range of 400m euros (438 million). The company also said that it would ensure the salaries of 1,800 of its Russian workers until the end.

According to Heineken, “We concluded that Heineken’s ownership in Russia of the business is neither sustainable nor financially viable.” The company released a statement in which it stated that any sale of its ownership would result in no profits.

The shares of the company were 0.3% higher by 1423 GMT.

Last year, Carlsberg generated 10% of total revenue and 6% operating profit in Russia. The country has eight breweries with 8,400 workers. Baltika was taken under its control in 2008. However, sales have been slow due to the sanctions-hit country and laws to combat alcohol abuse.

Jefferies analysts stated in a research note that “the announcement by Carlsberg to leave Russia should help clear the air” and eliminate the risk of overhanging,

According to the annual report, Russian non-current assets of the Danish brewery were 19.2 billion Danish crowns (or $2.83 billion). This is approximately 15% or 44% respectively of total assets.

Turkey’s joint venture is Russia’s 2nd largest brewery. Anadolu EfesBelgium InBev.

InBev had announced in March that it will stop selling Bud beer to Russia. The joint venture has 11 breweries in Russia, and 3500 workers.