Due to the war in Ukraine, Dutch brewing giant Heineken has announced that it will be leaving Russia and plans to transfer its business in the country to new owners.
The move follows the company's decision earlier this month to pause new investments and exports into Russia and halt the production, advertising and sale of the Heineken brand there, however this didn't signify a complete cessation of its Russian business as Heineken employs 1,800 people in the country where it makes the Zhigulevskoe and Oxota brands for the local market.
But now, Heineken has decided to leave Russia completely.
"We are shocked and deeply saddened to watch the war in Ukraine continue to unfold and intensify. We earlier announced that Heineken stopped new investments and exports to Russia, ended the production, sale and advertising of the Heineken brand, and announced that we will not accept any net financial benefits or profit from our business in Russia.
"Following the previously announced strategic review of our operations, we have concluded that Heineken’s ownership of the business in Russia is no longer sustainable nor viable in the current environment. As a result, we have decided to leave Russia."
Reduced operations during transition period
The brewer said it aims for an orderly transfer of the business to a new owner in full compliance with international and local laws. "To ensure the ongoing safety and well-being of our employees and to minimise the risk of nationalisation, we concluded that it is essential that we continue with the recently reduced operations during this transition period," Heineken stated.
The brewer guaranteed that the salaries of its 1,800 employees in Russia will be paid to the end of 2022 and that the company will do its "utmost to safeguard their future employment".
"We will not profit from any transfer of ownership and we expect an impairment and other non-cash exceptional charges of approximately €0.4bn in total," it added.
Upon completion of the transfer, Heineken will no longer have a presence in Russia.
"We continue to hope that a path to a peaceful outcome emerges in the near term," the company said.