Heineken withdraws from Russia in midst of Ukraine war

Heineken, the Dutch brewer, joined the foreign corporate flight from Russia on Monday, saying it was “very sorry” to watch the dispute escalate. 

Earlier this month, the beer firm, which employs 1,800 people in Russia, froze the sale and manufacture of its Heineken brand, as well as new investments and exports to the nation. 

Hundreds of Western companies have shuttered stores and offices in Russia since the war began, including household brands such as Ikea, Coca-Cola, Goldman Sachs, and McDonald’s. 

“We are startled and extremely saddened to see the situation in Ukraine unfold and worsen,” Heineken stated in a statement.  

“Following the previously disclosed strategic evaluation of our operations,” the statement added, “we have determined that Heineken’s ownership of the company in Russia is no longer sustainable nor profitable in the present context.” 

“As a result, we have made the decision to leave Russia.”  

Heineken stated that it will strive for a “orderly transfer” of its business to a new owner in accordance with international and local rules, and that it will not benefit from the deal, which will cost the firm 400 million euros ($438 million) in extraordinary costs. 

Heineken is Russia’s third-largest brewer, producing the Zhigulevskoe and Oxota brands for the domestic market.  

Heineken suspends beer sales in Russia

Recall that Heineken NV declared in a statement on Wednesday that it has ceased producing and selling its own brand beer in Russia, following a flood of companies fleeing the nation in response to Ukraine’s invasion.  

The move builds on the Dutch brewer’s prior actions, which included a halt to all new investments in Russia as well as shipments of other brands.

The company stated in a statement that production, promotion, and sales of the Heineken brand will cease immediately. 

The company said it would continue on reduced operations during a transition period to reduce the risk of nationalization and “ensure the ongoing safety and wellbeing of our employees”. 

“In all circumstances we guarantee the salaries of our 1,800 employees will be paid to the end of 2022 and will do our utmost to safeguard their future employment.” 

Guaranteeing salaries

The company stated that it will continue to operate on a smaller scale during a transition phase to minimize the possibility of nationalization and “guarantee the continuous safety and wellness of our personnel.” 

“In any circumstances, we guarantee that our 1,800 employees’ wages will be paid by the end of 2022, and we will do all possible to ensure their future employment.”