London (CNN) — Heineken has announced its departure from Russia following the sale of its business in the country for a symbolic €1 ($1).
The Dutch beer maker said in a statement Friday that it had received the necessary approvals to sell its operations to Arnest Group, a Russian manufacturer, completing a withdrawal process it initiated in March 2022.
Heineken CEO Dolf van den Brink said that “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,” he added.
The brewer expects to incur a total loss of €300 million ($323 million) from the deal.
When Moscow launched its full-scale invasion of Ukraine in February 2022, a slew of multinational companies left Russia, or announced plans to do so. But over the past 18 months, the Kremlin has made it increasingly difficult for Western firms to sell their Russian assets.
It now also obliges them to pay a hefty fee to the Russian government on such sales.
In March, Heineken said it had decided to “do everything possible” to avoid its Russian business being nationalized, while leaving the country “as quickly as possible.”
“First, we don’t think the Russian state or the people closest to it would have the best interests of our people at heart. Second, we were uncomfortable that the Russian state should benefit from forced appropriation of major business assets,” it said in a statement.
Arnest Group, which manufactures cosmetics, household goods and metal packaging for consumer goods, has provided all 1,800 of Heineken’s employees in Russia with employment guarantees for the next three years as part of the deal.
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