Heineken completes exit from Russia with €300m in losses

25 Aug 2023 --- Heineken has completed the transaction to sell its Russia operations to Arnest Group. The transaction has received all the required approvals and concludes what was started last March to exit Russia, incurring an expected total cumulative loss of €300 million (US$323.6 million).

The purchase price for the Heineken Russia business is €1 (US$1.08) for 100% of the shares.

All remaining assets, including seven breweries in Russia, will transfer to the new owners.

The Heineken brand was removed from Russia in March 2022, and now the company states that the production of Amstel will be phased out within six months.

Arnest Group owns a major can packaging business and is the largest Russian manufacturer of cosmetics, household goods and metal packaging for the FMCG sector.

Arnest Group has taken responsibility for the 1,800 Heineken employees in Russia, providing employment guarantees for the next three years. 

No other international brands will be licensed in Russia, except for a three-year license for some smaller regional brands, which are required to ensure business continuity and secure transaction approval.

Heineken will provide no brand support and receive no proceeds, royalties or fees from Russia.
Heineken will provide no brand support and receive no proceeds, royalties or fees from Russia.

There is no call option to return to Russia, states the company.

Financial impacts
As a result of exiting Russia, Heineken expects total non-cash exceptional losses amounting to €300 million (US$ million), including cumulative foreign exchange losses relating to Russia currently recorded in equity. 

This includes a commitment from Arnest Group to repay the historical intercompany debt of the Russian business of approximately €100 million (US$ million) due to Heineken in installments.

The transaction will have a negligible impact on diluted EPS (beia), and Heineken’s full-year 2023 outlook is unchanged from the sale.

“We have now completed our exit from Russia. Recent developments demonstrate the significant challenges faced by large manufacturing companies in exiting Russia. While it took much longer than we had hoped, this transaction secures the livelihoods of our employees and allows us to exit the country in a responsible manner,” says Heineken’s CEO and chairman of the executive board, Dolf van den Brink.

Edited by Gaynor Selby