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.
The world's second-largest brewer said the deal had received all the required approvals and was likely to leave it with exceptional losses of €300 million.
Heineken announced its intention to exit Russia in March 2022, after Russia's invasion of Ukraine, acknowledging that the process had taken longer than expected.
'Significant Challenges'
"Recent developments demonstrate the significant challenges faced by large manufacturing companies in exiting Russia," chief executive Dolf van den Brink said in a statement.
Many multinational companies flocked to leave Russia after the West imposed unprecedented sanctions on Moscow, but the Kremlin has retaliated by seizing some assets.
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.
'Risk Of Nationalisation'
Russian President Vladimir Putin signed a decree in July to take control of French yoghurt maker Danone's Russian subsidiary along with beer company Carlsberg's stake in a local brewer.
Anheuser-Busch InBev has also said it plans to exit its joint venture in Russia with Turkey's Efes.
Asked if the experiences of Danone and Carlsberg had increased the urgency for Heineken to do a deal, van den Brink told reporters: "Our concern went up but not the urgency. It showed there was a real risk of nationalisation and all you could do was seek to be master of your fate."
'Highly Complex'
He would not go into details as to why the search for a buyer took longer-than-expected, calling the process "highly complex".
"We are happy we found a suitable buyer. We believe it is a reliable party...We are happy this process comes to an end and to be able to leave Russia," he added.
Heineken had seven breweries in Russia and 1,800 employees, who will receive employment guarantees for the next three years.
Three-Year Licence
The Dutch brewer removed its Heineken brand from Russia last year and production of Amstel is to be phased out within six months.
Heineken said the deal, with no option to buy the business back, included a three-year licence for some smaller regional brands, for which Heineken would not provide brand support or receive any proceeds.
Negligible Impact
Arnest Group owns a major can packaging business and is the largest Russian manufacturer of aerosols, as well as selling cosmetics and household goods.
Heineken said the transaction will have a negligible impact on its full-year outlook.
