Carlsberg brewery adrift after seizure of its business in Russia

carlsberg it felt “shocked” over the Russian seizure of his business in the country last month and the brewer doesn’t know what could happen next, its chief executive said Wednesday.

Russia took control of the Danish group’s eight breweries and its 8,400 employees in the country last month, shortly after Carlsberg had agreed to sell the unit to an undisclosed buyer.

“We knew from the beginning, ever since we announced the intention to leave Russia in March last year, that there was enormous interest in the business from people inside Russia. But even so, it is an unprecedented event.”said CEO Cees ‘t Hart at a press conference.

Last year, the group reduced the value of its Russian unit Baltika by 9.9 billion crowns ($1.5 billion). Under a Russian presidential decree last month, Carlsberg retains ownership of the unit, but no longer has any control or influence over it.

“Technically, it is not a nationalization, but at this moment we do not know how it will develop”Hart said. “This latest event will make Russia’s departure even more painful”.

Carlsberg is not in contact with any of its employees in Russia, but has limited contact with Russian authorities, Hart said.

Many multinational companies flocked to leave Russia after the West imposed unprecedented sanctions on Moscow following its full-scale invasion of Ukraine in February 2022, but the Kremlin has retaliated by seizing some assets.

Hart, who took the helm of Carlsberg in 2015, will be succeeded by ISS service provider CEO Jacob Aarup Andersen on September 1.

On Tuesday, Carlsberg raised its profit forecast for this year.

Sales in the second quarter rose 4% from a year earlier to 21.4 billion kroner, compared with analysts’ median forecast of 21.5 billion in a survey provided by Carlsberg.

Source: Reuters