Russia has appointed new directors for the subsidiaries of Danone and Carlsberg. According to the EU, Russia is completely unsafe as a market area.
President of Russia Vladimir Putin rewards his loyal circle by offering them holdings of Western companies stuck in Russia.
The most recent examples concern the holdings of the French food company Danone and the Danish brewing company Carlsberg. Control of the subsidiaries of both companies has been placed in the hands of Putin’s loyal allies.
Last Sunday, by decree, Putin placed the operations of Danone’s Russian subsidiary “temporarily” under Russian control. The same happened to Carlsberg, whose Baltika company was transferred to Russian control, i.e. nationalized. Now new managers have been appointed for the companies.
Nephew of Chechnya’s leader to head Danone’s subsidiary
The new CEO of Danone’s subsidiary Danone Russia was appointed yesterday, Tuesday Jakub Zakriev. He is the leader of Chechnya Ramzan Kadyrov nephew.
As a close ally of Putin, Kadyrov is allowed to rule the Russian region of Chechnya autocratically.
Zakriev, 32, is Chechnya’s deputy prime minister and the region’s minister of agriculture. Zakriev is known to have studied economics at Moscow State University when he was younger and to have previously served as the mayor of Grozny, the capital of Chechnya.
Kadyrov has called Zakriev his “beloved nephew” on social media, Reuters reports.
Last October, Danone announced that it would end its business in Russia, except for the production of baby food.
A company owned by Carlsberg and controlled by the billionaire brothers
The management of the Baltika company owned by Carlsberg has been given on its behalf To Taimuraz Bolloev. Bolloev is the billionaire brothers Yuri and Mikhail Kovalchuk circle of friends.
The Kovalchuk brothers have been part of Putin’s closest inner circle for years. From the Veljeks, Juri is, among other things, the largest individual owner and chairman of the board of the Russian banking group Rossija.
Both brothers are under economic sanctions imposed by Western countries.
The Kovalchuks had communicated to the Kremlin for a long time that they wanted to take over Baltika’s business, the economic newspaper Financial Times (FT) tells.
Baltika is Russia’s leading brewing company with a market share of around 30 percent.
Western ownership is distributed to Putin’s friends
Danone and Carlsberg have both tried to sell their Russian holdings, but without success.
According to the FT, the Russian Minister of Agriculture Dmitry Patrushev has actively torpedoed sales companies and wanted to ensure that the operations of the companies go “under their own control”. Patrushev’s father met Putin in the 1970s when they worked for the Soviet security police, the KGB.
– This is a redistribution of wealth to Putin’s inner circle, the anonymous Russian billionaire commented on the matter to FT.
In the same way, Russia also took over the Russian unit of the Finnish energy company Fortum in April.
According to the EU, Russia is currently a “completely unsafe” market area for foreign investors.
– Presidential decree [omaisuuksien takavarikoista] is yet another proof of Russia’s disregard for international law and rules, a spokesman for the European External Action Service Peter Stano said today.
– Russia is not only looting in Ukraine, but it is also illegally depriving the owners of the power to manage property in Russian territory, Stano continued.
Sources: AFP, Reuters