September 25, 2023

La Ronge Northerner

Complete Canadian News World

Ukraine is seeking to lure international companies from Moscow as the assets of Danone and Carlsberg have been confiscated

Ukraine is seeking to lure international companies from Moscow as the assets of Danone and Carlsberg have been confiscated

  • On Sunday, Russian President Vladimir Putin signed a decree for the government to take control of Russian subsidiaries of French food producer Danone and Danish brewery Carlsberg.
  • About 1,000 international companies have begun the process of leaving Russia after its illegal invasion of Ukraine in February 2022, but many of them have not successfully sold their assets in the country.
  • “If you’re going to fund rebuilding Ukraine, you’re not going to pump a penny into Ukraine unless you get long-term guarantees from NATO,” said David Roche, a veteran investor and head of Independent Strategy.

A bartender carries a glass of Carlsberg beer at a bar in St. Petersburg, Russia.

Alexander Demyanchuk, Russia

Ukraine is urging global companies to pull their investments from Russia and move to its war-stricken neighbour, as Moscow continues to confiscate the assets of foreign companies.

Russian President Vladimir Putin signed a decree on Sunday for the government to take control of the Russian subsidiaries of French food producer Danone and Danish brewer Carlsberg, taking the shares of the two companies under “temporary management.”

About 1,000 international companies The process of leaving Russia has begun after its illegal invasion of Ukraine in February 2022, but many of them have not yet successfully sold their assets in the country.

Sunday’s move marked the first time Russia has taken over subsidiaries of Western firms since it took over Finnish and German energy firms Fortum and Uniper in April. The Kremlin earlier suggested this was retaliation for the West’s seizure of Russian assets.

Sergey Tsevkach is the CEO of UkraineInvest, a government agency tasked with attracting foreign direct investment to Ukraine and promoting the country as a safe, long-term investment option for international business.

“We are very interested in those [companies] That stopped plans to invest in Russia,” Tsevkach told CNBC via video link from Kiev late last month.

See also  Jack Ma-Backed Ant Group to buy back shares at 70% lower valuation than IPO - The Carlyle Group (NASDAQ: CG), Tencent Holdings (OTC: TCEHY)

“We have identified about 200 global companies that have suspended investment activities in Russia and are in contact with them in order to provide the possibility of building manufacturing facilities in Ukraine instead of Russia.”

Tsivkach has also called for more companies with operations in Russia to pull out, urging CEOs to consider not only the ethical implications, but also the business case for a full liquidation.

“We understand there may be difficulties selling your business and leaving Russia, but this should be high on every CEO’s agenda still operating in Ukraine,” he said.

“It is important to show that the aggressor cannot receive any investments or any operations from international companies.”

More than 1,000 companies have publicly announced that they are voluntarily reducing their operations in Russia beyond the minimum required under international sanctions, according to Yale School of Managementbut some continued to operate undeterred.

“I think they need to make a faster decision, because it’s not just about ending the war and our victory and ending hostilities, it’s about the inability of any reputable international company to work in Russia during the war and after the war,” Tsevkach said.

“A country that illegally invaded its neighbor without reason cannot be trusted by any private company, because its assets can be seized without reason in time, and nationalized, so companies need to understand that Russia is not a trading partner you can rely on.”

Zivkach was speaking before Russia’s takeover of Carlsberg-owned Baltika Breweries and Danone Russia, both of which are now controlled by Russia’s federal agency and state property agency Rosimushchestvo, by Putin’s decree.

Carlsberg said in a statement on Sunday that it would “assess the legal and operational consequences of this development and take all necessary measures in response.”

See also  Coinbase is providing a fiery response to the SEC Wells notice

The company announced in March. 28, 2022 that it would seek to completely dispose of its business in Russia, and signed an agreement in June. 23, 2023 to sell the subsidiary, Despite this She was waiting for the organization consent.

Carlsberg said the prospects for a sale are now “very uncertain” and that they are “in the process of getting more detailed information.”

Dannon said it too He was position investigation, After it began to transfer control of its business in the country To a Russian entity in October last year.

“Danone is preparing to take all necessary measures to protect its rights as a shareholder of Danone Russia, and the continuation of business operations for the benefit of all stakeholders, in particular its employees,” the company said on Sunday.

Russia also on Monday Disconnected The Black Sea Grain Initiative, a major humanitarian corridor to deliver Ukrainian grain to global markets, just hours before the UN-brokered deal was set to expire.

Tsevkach suggested, given the unpredictability associated with maintaining operations in Russia What can Decades pass before companies see enough of a feasibility study to consider returning to the country.

XXX Can we cut this quote? “I hope that international companies will understand this as soon as possible for their sake, for the sake of Ukraine and for the whole world, because this is a very serious thing that Russia has initiated not only for Ukraine, but for the whole world’s stability and security.

Ukraine The Allies pledged nearly $60 billion for the country’s recovery and reconstruction at the Ukraine Recovery Conference in London in June. UkraineInvest, meanwhile, is currently Supervising 17 investment projects worth more than $2.3 billion. XXX Can we end this here?

See also  Carl Icahn starts a proxy fight with McDonald's over the welfare of pigs

However, with the end of the war not near, many investors are reticent about investing in the country.

David Roach, a veteran investor and head of Independent Strategy, told CNBC last week that the investment Necessary to secure the future of Ukraine must come Not from corporate, but from NATO.

at the top of vilnius, LithuaniaEarlier this month, the 31-member military alliance gave more weapons to Ukraine. But Roche said the promised weapons were not the long-range missiles that could be pivotal in helping Ukraine win the war.

Tensions also arose between the leaders, with Ukrainian President Volodymyr Zelensky lamenting that there was no timetable for Kiev to join NATO.

“We’re still arming Ukraine so that it continues not to lose this war, but we’re not arming it to win this war, and I think that’s a very important flaw,” Roche said.

“If you’re going to finance rebuilding Ukraine, you’re not going to put a dime into Ukraine unless it has long-term guarantees from NATO, because your war investment can be wiped out. Often overlooked but very important – does NATO meet the guarantees needed to get the private sector in? To Ukraine? I think the answer is no.”

Adding that long war In Russia’s interest, because NATO will not allow Ukraine to join the alliance while it is still involved in it Live conflict.

“Yes, we’ve seen Sweden join the alliance and we’ve seen Turkey seem to change direction and support the West more openly, but we haven’t seen the real tipping point, which is the security issue for Ukraine,” Roche said. XX end of quote here?