Putin seizes Nestle’s Russian business in a move against the West, Nestle prioritising employees
Swiss food giant Nestle is weighing "all necessary steps" after its Russian business was seized by the Kremlin and put in temporary administration.
Nestle is weighing all options to protect its rights after the Kremlin’s decision to take control of the Swiss food maker’s Russian business, the latest move against a Western company since the war in Ukraine began.
The maker of Nescafe coffee and KitKat chocolates said it took note of the decision, announced in a presidential decree on Thursday, and was assessing the situation.
“Nestle is committed to taking all necessary steps to protect its rights and ensure continuity of business operations in the interests of all stakeholders, particularly its employees,” the company said on Friday.
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Russia has tightened control over foreign-owned assets since the start of the Ukraine war in 2022.
A 2023 decree signed by President Vladimir Putin gives Moscow the power to place assets from countries it deems “unfriendly” under temporary administration.
Moscow has also used the law to raise cash through forced sales, exit taxes and discounts, while rewarding Kremlin-loyal insiders.
French supermarket group Auchan was also targeted by Thursday’s decree, with its Russian assets transferred to the temporary management of LEV Management.
Auchan, which runs 230 stores and an online business in Russia, employing about 30,000 people, declined to comment.
Kremlin spokesman Dmitry Peskov told reporters that politics was a factor in the decisions.
Without naming Switzerland and France, he alleged they were “actively involved in military actions” against Russia, including “strikes by the Kyiv regime on the objects of our peaceful economic infrastructure”.
The Swiss government, which has been sharply criticised by the Kremlin for following European Union sanctions on Russia, had no immediate comment on the matter.
Nestle has six factories in Russia producing coffee, pet care and infant formula products.
It generated sales of about two billion Swiss francs ($A3.4 billion) in Russia in 2021, the last year it released figures, and has about 7000 employees there.
The sales figure corresponds to about two per cent of Nestle’s total sales, although analysts estimate the contribution has declined after the company scaled back activities in the country.
