Russia Seizes Nestle, Auchan, Leroy Merlin Assets in Retaliation
Kremlin places subsidiaries under temporary management citing Western support for Ukrainian strikes on Russian infrastructure.
KEY POINTS
- Putin decree places Nestle, Auchan, Leroy Merlin Russian units under L.E.V. Management control
- Kremlin cites Western military support for Ukraine and strikes on Russian infrastructure as justification
- Nestle employs 7,000+ staff across six Russian factories; shares dropped 2% in Zurich
- Auchan runs 230 stores with 30,000 employees; Leroy Merlin also owned by French Mulliez family
- Follows 2023 seizures of Danone and Carlsberg assets under same 'unfriendly countries' mechanism
President Vladimir Putin ordered the Russian subsidiaries of Nestle, Auchan, and Leroy Merlin placed under temporary management on Thursday, transferring control to L.E.V. Management. The decree amends a 2023 mechanism allowing asset seizures from companies in "unfriendly" countries.
Kremlin spokesman Dmitry Peskov stated the move responds to European nations actively supporting Ukraine militarily, specifically citing French backing for Ukrainian strikes on Russian civilian infrastructure. He noted Switzerland's support for EU sanctions as a factor for Nestle.
“We are talking about European companies, companies from unfriendly countries... These are unfriendly countries that are actively involved in military actions against our country.”
Nestle, which operates six factories employing over 7,000 people in Russia, said it is evaluating options to protect its rights and ensure business continuity. The company's shares fell around 2% in Zurich trading on Friday.
Auchan operates 230 stores with 30,000 employees in Russia, while Leroy Merlin is controlled by the French Mulliez family. Neither retailer commented publicly on the decree.
Russia previously used the 2023 decree to seize local units of Danone and Carlsberg in 2023. The latest escalation follows increased tensions over alleged European sabotage campaigns and nuclear deterrence debates.
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