London
19 °C
Manchester
Glasgow
18 °C
Dublin
12 °C
Belfast
Washington
Denver
17 °C
Atlanta
22 °C
Dallas
27 °C
Houston Texas
New Orleans
El Paso
Phoenix
Los Angeles
27 °C
10 °C
24 °C
Russia seizes assets of Nestle, French firms / Photo: Hector RETAMAL - AFP
Russia seizes assets of Nestle, French firms
Russian authorities have seized the businesses and assets of Swiss food giant Nestle and three French groups, a move the Kremlin defended Friday as a justified measure against firms representing "unfriendly countries" that back Ukraine.
A decree signed by President Vladimir Putin transferred the Russian operations of Nestle, French retailer Auchan and the former Leroy Merlin DIY chain, now known as Lemana Pro, to a company called LEV Management.
The decree, issued late Thursday, also covers the Russian subsidiaries of French logistics group FM Logistic.
Investigative outlet Novaya Gazeta Europe reported that LEV Management was only created at the end of 2025, and is headed by a Russian interior ministry general. It had no known business activity.
It was the latest move by Russia against Western firms in response to a barrage of sanctions over its war against Ukraine, now in a fifth year.
Most Western companies quickly sold their Russian operations and holdings after the Ukraine invasion, or at least isolated them, as sanctions have made trading in most goods difficult.
Russia has since made it difficult for firms to leave, requiring presidential authorisation for deals, or seizing the assets outright.
- Assets at risk -
In a short statement, Nestle said it was "committed to taking all necessary steps to protect its rights and ensure continuity of business operations in the interests of all stakeholders, particularly its employees".
"The company is assessing the situation and its options," it added, without providing details of its residual Russian operations.
Jean-Philippe Bertschy of the Swiss investment bank Vontobel said he expected the financial impact to Nestle would be small "given Russia's limited contribution to group sales".
He said Russia now accounted for just over one percent of the group's sales, down from around two percent before the Ukraine war.
It has suspended "the vast majority of sales, non-essential imports, advertising and capital investment", he said, while continuing to supply essential food items.
Auchan and Leroy Merlin are both controlled by France's Mulliez family.
Auchan's Russian subsidiary said Friday that it had requested "clarifications" from the authorities over Putin's decree.
The food and consumer goods group is one of Russia's main retailers, with 241 stores in the country, including 62 hypermarkets, and over 33,000 employees according to its website.
"Once the corresponding information has been received, we will be able to provide more detailed comments," Auchan Retail Russia said a statement to Russian news agencies.
The latest seizure echoes a string of other forced asset transfers, including Moscow's 2023 takeover of Danone's Russian business, which was later sold to a nephew of Chechen leader Ramzan Kadyrov.
bur-rco/rh/js/tw
C.Thomas--PS
