Nestlé assesses Russia options after decree places local unit under external administration

  • Nestlé is assessing options after Russia placed its Russian business under temporary administration.
  • Nestlé shares fell 1.5% in early Zurich trading.
  • Bank Vontobel estimates Russia contributes around 1% of Nestlé group sales.

Nestlé is assessing its options after a presidential decree announced Thursday placed its Russian business under temporary administration, extending Moscow’s campaign to tighten control over foreign-owned assets since the war in Ukraine began. The Swiss food maker said it would take all necessary steps to protect its rights and maintain operations, particularly for employees and other stakeholders. Nestlé has six factories and about 7,000 employees in Russia, where it recorded roughly 2 billion Swiss francs ($2.4 billion) in sales in 2021. Its shares fell 1.5% in early Zurich trading. Auchan’s Russian assets were also transferred to L.E.V. Management. Analysts said Russia now accounts for about 1% of Nestlé group sales after the company reduced its activities, limiting the direct financial effect but leaving its local assets exposed to potential impairment, disposal or expropriation.

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