Unilever has successfully divested its Russian operations, marking a significant withdrawal from the market.
- CEO Hein Schumacher announced the sale to Russian-based Arnest Group, concluding a complex preparation phase.
- The decision aligns with pressures from campaigners concerned about the company’s links to Russia amid geopolitical tensions.
- The £300 million deal includes all Russian and Belarusian assets, sold at half of its initial valuation.
- This sale follows a trend among global FMCG companies reassessing their involvement in the Russian market.
Unilever, a leading global consumer goods company, has finalised its exit from Russia by selling its local operations to Arnest Group. CEO Hein Schumacher revealed the transaction details, emphasising the intricate preparations undertaken over the past year. The strategic decision came after sustained pressure from campaigners who criticised Unilever’s presence in Russia, citing alleged contributions to the ongoing conflict with Ukraine.
The deal encompasses all Unilever’s business divisions in Russia, including four major factories, as well as its operations in Belarus. This comprehensive exit required substantial efforts, such as transitioning IT systems and translating branding to Cyrillic, to facilitate the handover effectively.
Campaigners had previously urged for the revocation of royal warrants from several British FMCG companies, Unilever included, due to their operations in Russia. This sale, valued between £300 million and £334 million, reflects roughly a 50% markdown from the initial valuation of Unilever’s Russian and Belarusian assets. Such financial adjustments signal the costliness and challenging nature of geopolitical disengagement for multinational enterprises.
This move is consistent with actions taken by other FMCG giants, notably Danone, which encountered difficulties in managing its Russian accounts, culminating in a significant financial loss. The trend underscores the growing complexity and potential pitfalls associated with maintaining commercial ties in politically volatile regions.
Unilever’s exit from Russia underscores a strategic shift in response to mounting external pressures and geopolitical complexities.
