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Paris (FBC) French agribusiness Danone said on Friday it planned to take over its important dairy and plant business in Russia, retaining only its baby nutrition arm.
Danone, one of the few multinationals left in Russia after the Ukraine war, said the move to hand over “effective control” of its dairy business could result in a write-down of up to one billion euros ($980 million).
The arm will represent five percent of Danone’s net sales by 2022.
“Danone considers this the best option to ensure long-term domestic business continuity, for its employees, consumers and partners,” the group said in a statement.
The transaction will be subject to regulatory approval, the group added.
Danone, however, retains its “special nutrition” arm, which includes infant formula.
“Danone’s priority is to act responsibly and with respect for its employees, consumers and partners in the environment,” the statement said Friday.
In March, the French group said it would continue to operate in Russia, where it employs 8,000 people after several international companies shut down in the wake of Moscow’s invasion of Ukraine.
But in July, Danone spoke of an “extremely tense” operating situation in Russia and Ukraine.
Multinational immigration
A large number of major Western companies have fled Russia since Moscow invaded its pro-Russian neighbor on February 24.
Starbucks and McDonald’s were among the American corporations to withdraw.
McDonald’s – which employed 62,000 workers in Russia – was bought by Russian businessman Alexander Gover and renamed “Vkusno i tochka” (“Delicious. Full Stop”).
Starbucks’ Russian operations have been purchased and reopened with a new name and logo.
Denmark’s Lego, the world’s largest toy maker, said in July it would “cease business indefinitely” in Russia, ending its partnership with a retail group that operates 81 stores on behalf of the brand.
French automaker Renault left the country in May and handed over its assets to the Russian government.
Other companies to wind up their Russian business include clothing brands Nike, Adidas and H&M, Swedish furniture giant EK and US tech giant Cisco.
© 2022 AFP
