‘We Have Now Completed Our Exit From Russia’: Heineken Sells Business in Russia Worth Over $300 Million for Only 1 Euro
(Photo: Stella de Smit/Unsplash)
On Friday, Heineken announced it has sold its business in Russia for a little over 1 dollar (€1). The Arnest Group purchased 100% of the major beer companies’ shares in the region for this low, low price. The sale conclusions are a process Heineken initiated in March 2022 to exit Russia and the company projected losses are €300 million (almost $325 million).
Russia’s invasion of Ukraine early last year prompted many companies, including those in the alcohol industry, to make commitments to distance their business dealings with the invaders. After over a year, many consumers became disgruntled to learn that the companies that made announcements to stop business in Russia appeared to not be acting quickly enough. As the major international companies tell it, the process of dissolving business in Russia was not a speedy endeavor.
Other companies, like Bacardi, appear to have given up on the idea of leaving behind its assets in Russia. Instead, the spirits giant has seen profits grow in the region. Bacardi’s continued business dealings earned them the title of international war sponsor from Urkaine’s National Agency on Corruption Prevention.
In a statement, Heineken’s CEO and Chairman of the Executive Board Dolf van den Brink said, “We have now completed our exit from Russia. Recent developments demonstrate the significant challenges faced by large manufacturing companies in exiting Russia. While it took much longer than we had hoped, this transaction secures the livelihoods of our employees and allows us to exit the country in a responsible manner.”
The €1 purchase price includes 7 breweries in Russia and Arnest Group committed to guaranteeing the employment of Heineken’s 1,800 workers for the next three years. The Heineken brand was removed from Russia in 2022 and “Amstel will be phased out within 6 months,” added the statement.
Heineken indicated that the sale of its assets in Russia will have a negligible impact on the company’s 2023 outlook. The parent company, Heineken Holding NV is one of the big three brewers in the world with its main competition being Anheuser-Busch InBev and Molson-Coors.
It makes sense for a multibillion-dollar company to feel little effect from losing business in Russia. In 2022, Heineken spent €2.2 billion (about $2.3 billion) on alcohol advertising and $325 million seems like a drop in the bucket in comparison.
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