Denmark's Carlsberg receives around $320 mln in deal to sell Baltika
MOSCOW. Feb 6 (Interfax) - Carlsberg Group has received DKK 2.3 billion, or approximately $320 million, in a cash consideration for the sale of the Baltika brewery, the Danish company said in its 2024 financial report.
Carlsberg Group closed the deal to sell the Russia-based business at the end of last year through a management buyout. The company initially did not disclose the buyers or the transaction amount. Later, it emerged that Baltika had come under the ownership of VG Invest.
"As part of the agreement, the parties settled all outstanding legal disputes, including issues related to intellectual property rights. In doing so, Carlsberg received a cash consideration of approximately DKK 2.3 billion and retained 100% ownership of Carlsberg Kazakhstan and Carlsberg Azerbaijan," the group said.
Before the deal was announced, a decree signed by Russian President Vladimir Putin dated December 2 was published, removing Carlsberg's assets in Russia from temporary government administration. The document revoked the provisions of the decree from April 23, 2023 (as amended on July 16, 2023), which had introduced government administration for 98.56% of the stake in the authorized charter capital of Baltika Breweries LLC, as owned by Carlsberg Sverige Aktiebolag; for 1.35% of the stake in the authorized charter capital of Baltika Breweries LLC, as owned by Hoppy Union LLC, and for 0.09% of the stake in the authorized charter capital of Baltika Breweries LLC, as owned by Carlsberg Deutschland GmbH.
Carlsberg Group, the largest foreign investor in the Russian beer market, announced plans to exit Russia in March 2022. At the end of June 2023, the company said that it had signed an agreement to sell its Russian business, without disclosing the future owner of Baltika or the deal's parameters.
However, the sale did not take place and the Russian president signed the decree on July 16, 2023 placing the Carlsberg assets under the Russian Federal Property Agency's (Rosimushchestvo) administration. Carlsberg was forced to acknowledge that the prospects for the sale became extremely uncertain in the wake of the decree. In late October, when commenting on its quarterly results, the company described the situation as "illegal business seizure in Russia" and announced plans to defend its assets, which it had written off in its accounts at nearly $1 billion.
In October 2023, Carlsberg Group terminated its licensing agreements with Baltika for the production and sale of all group products, including international and local brands. In response, Baltika took the matter to court. On October 19, 2023, the court imposed interim measures, prohibiting the Federal Service for Intellectual Property (Rospatent) from registering the termination of trademark usage rights for brands such as Holsten, Kronenbourg, Tuborg and Seth & Riley's Garage. In December 2023, the court of first instance upheld Baltika's lawsuit against Carlsberg, ruling the unilateral termination of the licensing agreements for the production and sale of these brands invalid.
The case was postponed several times.
Taimuraz Bolloyev became president of Baltika in July 2023. He had previously headed the company for 13 years, until 2004. He was added to the EU sanctions list in June 2024.
Vedomosti reported in the autumn of 2023 that Bolloyev had suggested nationalizing the company, saying Carlsberg had not accepted the Russian side's proposal concerning financial calculations and the mutually profitable use of the brands after the transfer of Baltika to the management of Rosimushchestvo. However, Russian Finance Minister Anton Siluanov said in late 2023 that the Russian authorities had no plans to nationalize Baltika at the time.
Baltika is Russia's second largest brewing company. It operates eight breweries.