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Carlsberg CEO: Russia stole our business

Carlsberg’s CEO has said the brewer won’t enter into negotiations with the Russian state regarding its former business in the country. 

(Image: Jacob Aarup-Andersen, CEO, Carlsberg)

The comments from Jacob Aarup-Andersen came on a call with journalists yesterday followed its quarterly trading update yesterday, where it highlighted growth in a “challenging environment”.

It follows the company attempted to offload its Baltika subsidiary after the war in Ukraine last year, when an exodus of other Western companies left Russia.

The firm had found a buyer for the business in June this year, and formally announced plans, noting that 150 work streams and DKK150 million (£17.3m) in brewery equipment investments had to be considered.

Group CEO Cees ’t Hart said at the time the sale had been “an extensive process” after criticism on how long it had taken to sell its Russian arm, but said it was “important for us to reach the best possible solution for all stakeholders, including our more than 8,000 employees in Russia.”

The group then needed approval from the Russian Government Commission, but the state then seized control of shares in the local Carlsberg-owned brewery, as well as food manufacturer Danone’s operations, in July.

In a statement at the time, Carlsberg said it had not received any “official information from the Russian authorities regarding the presidential decree or the consequences for Baltika Breweries”.

New CEO Aarup-Andersen has now spoken out about the situation, saying on the call: “There is no way around the fact that they have stolen our business in Russia, and we are not going to help them make that look legitimate.”

He said there had only been limited interaction with both Baltic’s management and Russian authorities since July, and as a result had taken a DKK9.9bn (£1.61bn) hit.

He continued: “We’re not going to enter into a transaction with the Russian government that somehow justifies them taking over our business illegally.”

The brewer has ended license agreements for its brands in Russia to sell Carlsberg products through the Baltika business, although Aarup-Andersen admitted that he “cannot guarantee” the Russian brewery will produce Carlsberg products. But he said “that is our expectation”.

The Russian finance ministry has said the federal property agency Rosimushchestvo has been appointed as a temporary manager, although it also said in a statement that “does not entail a change in the ownership structure”.

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