[Helsinki 4th Archyde.com]–How to dispose of the assets left in Russia ──. For many foreign companies still searching for answers, the order signed by President Putin on the oil and gas development project “Sakhalin 2” off the coast of Sakhalin in the Far East was a strong warning.
Mr Putin urged the transfer of the operation of the business in which Japanese companies are participating to a new company established by the Russian government, and other foreign companies also said, “If you do not make a decision early, you will be terrible.” I remembered it.
Today, various foreign companies are still struggling with ways to reduce their financial burden as much as possible and withdraw from Russia without endangering their employees. Some even wonder if they can secure an opportunity to return to Russia in the future.
Under these circumstances, Paulig, a Finnish coffee manufacturing and sales company for which Rolf Radau is the CEO, was one of the first companies to withdraw from Russia.
When Western countries began sanctions following Russia’s invasion of Ukraine, Mr. Radau decided that Russia’s business might no longer be maintained. Coffee wasn’t subject to direct sanctions, but freight companies stopped shipping to and from Russia, making it nearly impossible to bring coffee beans into the country. Settlement in rubles has become more difficult day by day.
So, Mr. Radau decided to withdraw from Russia two weeks following the start of the Ukrainian war, and following completing the procedure for finding a buyer, which normally takes up to one year, in the next two months, an Indian investor in May. Signed a contract to sell the business to.
However, these success stories belong to the minority. Similarly, less than 40 foreign companies have agreed to sell their businesses, including McDonald’s, Societe Generale and Renault.
When Archyde.com interviewed 5-6 executives of a foreign company that had disposed of Russian assets, it was difficult to sell quickly, it was difficult to predict success, and the reason why it took a long time to sell. It was revealed.
There are a number of hurdles that have come to light. Specifically, 1) confusion over what actions the Russian government allows foreign companies to do, 2) employee anxiety regarding the Russian side flickering retaliation for sanctions, and 3) buyers of businesses limited by sanctions. And, the time when the candidate buyer can be scrutinized, 4) the selling price was drastically reduced due to the current situation, and 5) there was a concern that he would go to the site and be detained, so he had to negotiate in a virtual manner. It is listed.
And as the Russian government prepares new legislation to allow Western companies to “requisition” their Russian business, the risks are only increasing.
Radau told Archyde.com before the Sakhalin-II business transfer order was issued, “Companies that have not yet started the asset sale procedure or are still skeptical of the sale will be in a more difficult position. Russia There is no benefit to allowing foreign companies to withdraw easily. “
Many Western companies are hitting a wall in their efforts to withdraw from Russia.
For example, Burger King, a US hamburger chain, stopped supporting stores in Russia in March this year. However, regarding 800 stores are still open. Legal experts say there is a problem with the complexity of joint venture franchise agreements.
Unicredit, a major Italian bank, was able to dispose of some assets through swap transactions. However, it was forced to expand the range of potential buyers to countries such as India, Turkey, and China.
Four months following Russia’s invasion of Ukraine, there are few signs that foreign companies have reached the “right answer” to free them from these annoyances. Even Renault and McDonald’s, who let go of the business, sold virtually zero. The two companies have also agreed to include a repurchase clause for their business.
Meanwhile, Paulig’s Radau has decided not to include a repurchase clause when selling the business. “The moral and ethical issues are so serious that we have no room to return to Russia.”
One of the reasons why foreign companies are unusual regarding this disposal of Russian assets is that there is no intervening bank, which normally plays an important role.
Banks are avoiding involvement for fear of breaching sanctions, sources said.
So foreign companies are relying on Russian legal experts and international consulting firms who are familiar with finding buyers for businesses in Russia to ensure the legitimacy of the sale procedure, compliance with sanctions and financial credibility. ..
However, some companies lamented that the advice they gave each time was inconsistent with what they had been doing, even among Russian advisors.
Still, Putin’s orders over Sakhalin 2 have made it clearer what will happen in the future. “The Russian government will soon move to retaliation, not just in gas, but in other areas,” said one of the foreign business executives who has been struggling to withdraw.
（Essi Lehto 記者、Anne Kauranen 記者）
