Carlsberg Exits Russia in €300 Million Deal
In a deal finally approved by Moscow, Danish brewer Carlsberg has agreed to sell its Russian assets, ending a tumultuous chapter for the company in the wake of the Ukraine invasion. The sale of Baltika Breweries, Carlsberg’s subsidiary in Russia, will see control of the iconic brand pass to VG Invest for a price of €300 million.
An Uncertain Chapter Ends
The deal marks the end of a period of uncertainty for Carlsberg, which had its Russian operations seized by the government in July 2023 and placed under “temporary management.”
The company had previously accused the Russian government of “stealing” its business after being forced to write off the Baltika Breweries investment.
This divestiture comes as a result of the Kremlin’s stringent restrictions on Western businesses seeking to exit the Russian market following the large-scale invasion of Ukraine. Moscow often demanded significant discounts on assets as a condition of approving sales.
Carlsberg, for its part, will receive cash as part of the transaction, though the specifics of the payment have not been disclosed. The company will also retain control of Baltika Breweries’ shareholdings in Carlsberg Azerbaijan and Carlsberg Kazakhstan, allowing it to maintain a presence in neighboring markets.
A Pragmatic Approach
“With today’s announcement, we will settle numerous lawsuits and IP rights issues related to Baltika Breweries,” Carlsberg chief executive Jacob Aarup-Andersen said. “Considering the circumstances, we believe it is the best achievable outcome for our employees, shareholders and the continued business.”
Although the sale represents a significant loss for Carlsberg, the company’s decision to exit the Russian market aligns with a broader trend among foreign businesses reevaluating their presence in the country following the war in Ukraine.
Besides the lower sale price due to a forced sale, what other factors may have influenced Carlsberg’s decision to prioritize a swift exit from Russia?
## Carlsberg Finally Exits Russia
**Interviewer**: Joining us today is [Guest Name], an expert on international business and the Russian economy. Carlsberg just announced they’ve finally sold their Russian assets, including the Baltika Breweries, after a long period of uncertainty. Can you tell us about this deal and what it signifies?
**Guest**: Certainly. This sale marks the end of a difficult chapter for Carlsberg. The company initially faced pressure to exit Russia following the invasion of Ukraine, but legal complexities and government scrutiny delayed the process. As reported by Bloomberg [[1](https://www.bloomberg.com/news/articles/2024-12-03/carlsberg-announces-sale-of-russian-assets-ending-legal-dispute)], the deal, worth €300 million, was approved just one day after President Putin signed a decree ending government control over the division. This suggests that Russia might be loosening some of its grip on foreign businesses.
**Interviewer**: €300 million seems like a relatively low amount considering the size of Baltika. Was this a fire sale?
**Guest**: It’s hard to say definitively. While Carlsberg initially wrote off the value of its Russian business, a forced sale often means accepting a lower price. The company might have prioritized getting out of Russia swiftly, even if it meant accepting a less than ideal deal.
**Interviewer**: What does this sale mean for other Western companies still operating in Russia?
**Guest**: This could be a signal, a positive one, that the environment might be becoming more favorable for foreign companies looking to exitRussia. But it’s too early to say for sure. Each company and each sector will face unique challenges.
**Interviewer**: Thank you for your insights, [Guest Name]. This is certainly a significant development in the ongoing story of Western businesses in Russia.