Russia threatens to seize multiple Western companies: bad news for Nestlé and Auchan supermarket

Russian President Vladimir Putin has issued a decree placing the local assets of 81 foreign companies under the temporary management of L.E.V. Management, an entity led by General Andrei Krayushkin. The affected firms include Swiss food giant Nestlé, French supermarket chain Auchan, construction retailer Lemana Pro, and logistics provider FM Logistic. While the companies technically retain ownership, they have lost operational control, echoing previous state seizures of firms like Danone and Carlsberg. Experts note this move recalls practices from the post-1917 Soviet era, putting pressure on Western businesses that remained in the country following the invasion of Ukraine.

In response to the decree, Nestlé stated it is evaluating the situation to protect its interests and employees, while Auchan reported that its facilities continue to operate normally while it seeks clarification on the order. This aggressive policy targets companies from nations deemed unfriendly due to their support for Ukraine. Historical precedents, such as the 1 billion euro write-down suffered by Danone when its assets were seized and handed to loyalists of Chechen leader Ramzan Kadyrov, suggest that these temporary management orders often lead to permanent loss of assets.