Putin Transfers Control of AB InBev’s Russian Operations
Vladimir Putin has handed over control of AB InBev’s Russian unit to a local firm, complicating the brewer’s exit strategy from the country.
AB InBev, Russia, Vladimir Putin, Anadolu Efes, Brewing
City: Moscow. So, here’s the scoop. Putin just gave a local company the reins to AB InBev’s Russian business. This move totally messes up the brewer’s plans to leave Russia through a deal with a Turkish partner.
According to a presidential decree, all shares of AB InBev Efes Russia are now under the control of the Vmeste group. But, details about this group are pretty scarce.
Back in October, AB InBev and Anadolu Efes had a plan to swap stakes in their Russian and Ukrainian operations. The idea was for the Turkish company to take over the Russian side while AB InBev would get the Ukrainian unit. But Russia wasn’t on board with that plan.
Now, with this latest twist, it’s unclear if AB InBev can actually exit Russia like other Western companies have done. Plus, the status of the Ukrainian deal is still up in the air, depending on approvals from the Kremlin.
After the news broke, AB InBev’s shares dropped by 1.5%, and Anadolu Efes saw a 10% decline. Since the invasion of Ukraine, many Western companies have been trying to figure out how to leave Russia without taking a huge financial hit.
Russia has made it tough for companies wanting to exit. They now face a steep 60% loss on sale values. Plus, Moscow has seized subsidiaries of companies trying to leave, like Carlsberg and Danone.
Both Carlsberg and Danone managed to regain control of their businesses before selling them off to Kremlin-approved buyers. Just recently, Carlsberg sold its Russian unit, Baltika Breweries, right after Putin lifted government control over it.
AB InBev has already taken a $1.1 billion hit on this asset. They plan to keep working with their joint-venture partner, and Anadolu Efes said they’ll assess the situation and respond accordingly.