Unilever quits Russia after striking deal with Arnest

10th Oct 2024 11:16

(Sharecast News) - Consumer goods giant Unilever has sold its Russian business, it was confirmed on Thursday, bringing to an end its presence in the country.

The owner of Ben & Jerry's, Hellmann's, Dove and Persil, among many others, said it had sold the business to Arnest Group, a Russian manufacturer of perfume, cosmetics and household products.

The blue chip did not disclose financial terms, although the Financial Times, citing unnamed sources, said it was worth €520m.

The assets, which include four factories as well as Unilever's business in Belarus, are understood to be worth around €600m, the FT added.

Western companies came under immediate pressure to quit Russia after Moscow invaded Ukraine in February 2022.

Unilever stopped all imports and exports of products in and out of the country from March 2022, but its Russian unit continued to trade. In 2023, it contributed around 1% of turnover and net profit.

The company attracted criticism for the decision and was dubbed an "international sponsor of war" by the Ukrainian government.

Unilever had previously argued that closing the unit would put thousands of people out of work, while selling it could benefit the Russian state.

However, last month it was reported that the group had finally agreed a sale with Arnest, which is owned by businessman Alexay Sagal.

Arnest has snapped up a swathe of Western companies' assets over the last two years, including Heineken and US manufacturer Ball Corporation.

In a brief statement, Unilever chief executive Hein Schumacher said on Thursday: "Over the past year, we have been carefully preparing the Unilever Russia business for a potential sale. This work has been very complex, and has involved separating IT platforms and supply chains, as well as migrating brands to Cyrillic.

"The completion of the sale ends Unilever Russia's presence in the country."

As at 1100 BST, shares in Unilever were largely unchanged at 4,784.39p.