Carlsberg A/S, the Danish owner of Russia’s biggest brewery, signed an agreement to sell its operations in the country to an undisclosed buyer, more than a year after deciding to exit.
The deal is subject to regulatory approval and fulfillment of certain conditions in a number of jurisdictions, making the timing of completion uncertain, Carlsberg said on Friday. It didn’t provide a value for the transaction.
The Danish company, which announced that it would exit Russia completely in March of last year, said the separation of the Russian business from the rest of the group has been “very complicated.” Foreign companies that are seeking to exit the country after its invasion of Ukraine are finding few potential buyers who aren’t subject to sanctions, and a Kremlin that has been increasingly unwilling to approve Western sales.
Read More: For Fear or Money, Consumer Giants Are Staying in Russia
“While it has been an extensive process, it has been important for us to reach the best possible solution for all stakeholders, including our more than 8,000 employees in Russia,” said CEO Cees ’t Hart, who had said he wanted to sign a deal before he hands over to his successor, Jacob Aarup-Andersen.
The sales agreement won’t affect earnings expectations for this year, the brewer said.
Russia and Ukraine accounted for about 13% of Carlsberg’s group revenue and about 9% of operating profit in 2021. The company employs about 8,400 people in Russia and had previously separated the operations there from the rest of the group.
A Carlsberg spokesperson said the brewer wouldn’t identify the buyer of its Russian assets or whether it had an agreement to buy back the operations if and when the conflict ends.
“We have of course done our due diligence regarding all potential buyers during this process, including to ensure that a potential buyer is not on applicable sanctions lists,” the spokesperson said in an email in response to questions. “The sale and the buyer have been authorised by Danish authorities in accordance with the relevant European Directive.”
--With assistance from Andy Hoffman.
(Updates with details in second paragraph, CEO comment in fourth)
