Heineken has sold its business in Russia for one euro, more than a year after it vowed to pull out of the country in response to Russian President Vladimir Putin’s invasion of Ukraine.
The Dutch brewer is taking a €300 million loss, worth roughly $325 million, by selling its business to Russian manufacturer Arnest Group, making Heineken one of the latest companies to pull out of Russia since the start of the war in Ukraine on Feb. 24, 2022, according to a group of experts at Yale University.
Heineken had faced criticism for the slow pace of its exit, which CEO Dolf van den Brink attributed to the company’s efforts to protect its Russian employees during the sale process.
“While it took much longer than we had hoped, this transaction secures the livelihoods of our employees and allows us to exit the country in a responsible manner,” he said in a statement on Friday.
More than 1,000 global companies have withdrawn or voluntarily curtailed operations in Russia so far, according to Yale University data.
Harder than it looks
The reality of exiting Russia is tougher than it may appear. Moscow has imposed increasingly stringent requirements for foreign businesses to exit the country after facing tough sanctions and the beginning of an exodus of companies last year.
The Russian government requires foreign companies to provide a 50% on their businesses after government-selected consultants value them, Reuters reported. It also requires foreign companies to contribute of 10% of their business’ sale price to the Russian budget.
Heineken’s sale covers all of its assets in Russia, including seven breweries. The company said that Arnest has guaranteed the employment of Heineken’s 1,800 local staff for three years.
Heineken brand beer was removed from the Russian market last year. One of its other major brands, Amstel, will be phased out within 6 months, the company said.
The brewery isn’t the only company to swallow big losses from bowing out of the Russian market. Last year, McDonalds said it expected to lose more than $1 billion to divest its Russia business.
The Associated Press contributed reporting.