Moscow demands bigger discounts from foreign companies exiting Russia

Some foreign companies trying to exit Russia are facing a big jump in costs as Moscow is demanding bigger discounts on the price tags of assets they want to sell, three people with knowledge of the matter said.

Russia has steadily tightened exit requirements since Western companies started leaving soon after Moscow began what it calls a “special military operation” in Ukraine in February 2022. Executives say navigating the rules is becoming harder.

Foreign companies have already been hit by losses of more than $80 billion from their Russian operations due to writedowns and lost revenue, based on an analysis by Reuters of company filings and statements.

 

Dutch brewer Heineken said on Friday it had completed its exit from Russia by selling its operations there to Russia’s Arnest Group for a symbolic one euro. Moscow has also gradually imposed additional exit hurdles.

The threat of nationalisation also looms, particularly following the July seizure of Danish brewer Carlsberg’s and French yoghurt maker Danone’s Russian assets.

Companies still in the process of negotiating exits include telecoms group Veon, Nasdaq-listed tech group Yandex and Italian lender Intesa. 

Moscow demands a 50 per cent discount on all foreign deals after consultants selected by the Russian government have valued the business. Russia also requires a contribution to the Russian budget of at least 10 per cent of the price.