Heineken announced its exit from Russia following the sale of its business in the country for a symbolic 1 euro (1 dollar).
The Dutch beer manufacturer stated in a press release on Friday that it had received the necessary approvals to sell its operations to Arnest Group, a Russian manufacturer, thereby completing a withdrawal process that began in March 2022.
Heineken CEO Dolf van den Brink said, “Recent events demonstrate the significant challenges faced by large manufacturing companies in exiting Russia.”
“While it has taken much longer than we expected, this transaction secures the livelihood of our employees and allows us to exit the country responsibly,” he added.
The brewery expects to incur a total loss of 300 million euros ($323 million) from the operation.
When Moscow launched its large-scale invasion of Ukraine in February 2022, many multinational companies either left Russia or announced plans to do so. However, over the past 18 months, the Kremlin has increasingly made it difficult for Western companies to sell their Russian assets.
Moreover, it now requires them to pay a significant fee to the Russian government for such sales.
In March, Heineken stated that it had decided to “do everything possible” to prevent its Russian businesses from being nationalized while leaving the country “as soon as possible.”
“Firstly, we don’t believe that the Russian state or those closest to it take into account the best interests of our people. Secondly, we’re uncomfortable with the Russian state benefiting from the forced appropriation of significant business assets,” the company stated.
Arnest Group, which manufactures cosmetics, household items, and metal packaging for consumer goods, has offered job guarantees to the 1,800 Heineken employees in Russia for the next three years as part of the agreement.