28 Mar 2022 16:46

Carlsberg to leave Russia

MOSCOW. March 28 (Interfax) - Carlsberg has decided to leave the Russian market, where it owns Baltika Breweries.

"On 9 March, we announced a strategic review of the Carlsberg Group's presence in Russia. Based on this review, we have taken the difficult and immediate decision to seek a full disposal of our business in Russia, which we believe is the right thing to do in the current environment. Upon completion we will have no presence in Russia," the Danish brewer said in a press release.

"We deeply regret the consequences of this decision for our 8,400 employees in Russia. Until the completion of the process, we will maintain the recently announced reduced level of operations to sustain the livelihoods of these employees and their families," it said.

"As a result of this decision, our business in Russia will no longer be included in the Group's revenue and operating profit. From an accounting perspective, the business will be treated as an asset held for sale until completion of the disposal. The business will be reassessed at fair value, which will result in a substantial non-cash impairment charge. In 2021, the business in Russia reported revenue and operating profit of DKK 6.5bn and DKK 682m respectively," it said.

Carlsberg Group made the decision earlier to immediately halt investments in and exports to Russia, and would not be producing beer under its flagship Carlsberg brand.

Carlsberg has owned a stake in Baltika since 2000. It became the majority shareholder in 2008 and later its sole shareholder, buying back shares on the exchange and delisting the company. Its brands portfolio includes Carlsberg, Tuborg, Holsten, Kronenbourg 1664, Baltika, Somersby and others.

Baltika is the second largest brewing company in Russia with a market share of 27.3%. It paid 61.1 billion rubles in taxes into the budgets of regions where it is located in 2021. The company's investments grew 30% last year to 3.7 billion rubles. Baltika has eight breweries in Russia.

Heineken, the second largest beer producer in the world, said on Monday that it had decided to leave the Russian market and transfer its business in the country to a new local owner.