Kremlin Places Nestle, Auchan Russian Units Under Temporary Control
Russia has placed the local businesses of Nestle and Auchan under temporary administration, invoking a 2023 law that has previously led to forced sales.
Russian President Vladimir Putin has ordered the Russian operations of Swiss food and beverage group Nestle and French retailer Auchan to be placed under temporary administration, a move that could precede the forced sale of those assets to Russian buyers.
The decree, signed late Thursday, also covers affiliates of international logistics firm BATI Group, Le Monlid, which runs the Russian do-it-yourself chain Lemana Pro, formerly Leroy Merlin, and French logistics group FM Logistic. All the affected local entities were placed under the management of a company called L.E.V. Management.
The step relies on a 2023 law that permits the Kremlin to bring businesses from "unfriendly countries" under temporary administration. In earlier cases involving French dairy producer Danone and Danish brewer Carlsberg, the businesses placed under such management were subsequently sold to new Russian owners.
Kremlin spokesman Dmitry Peskov told reporters on Friday that the companies concerned are "European companies, companies from unfriendly countries" that are "most actively involved in hostilities against our country," as well as in Ukrainian strikes "on our civilian economic infrastructure." He said these factors were taken into account alongside other operational considerations.
Peskov stressed that "at the moment, we're talking about the introduction of external management. No other decisions have been made so far."
Nestle, headquartered in Vevey, Switzerland, said it "takes note" of the decree and "is assessing the situation." In a statement, the company said it "is committed to taking all necessary steps to protect its rights and ensure continuity of business operations in the interests of all stakeholders, particularly its employees." Auchan representatives had no immediate comment.
Since the full-scale invasion of Ukraine in 2022, several major Western businesses have halted operations in Russia and written off their local units. The Kremlin has since imposed stringent conditions on disposals of Russian affiliates, requiring steep discounts, exit taxes and government approval. Other companies have reduced their presence, while some continue to operate as before.