Russia: the Kremlin takes control of Auchan and Nestlé

Whilst the Kremlin’s election campaign is based on glorifying the war in Ukraine and the resulting confrontation with the West, which supports it, the offensive against Europe shows no sign of letting up as Russia goes to the polls. Kremlin spokesperson Dmitry Peskov has, in fact, linked the decision to take control of the Russian assets of two European groups – the Swiss Nestlé and the French Auchan – to the active involvement of a ‘hostile country’, France, in ‘military actions against our country’. The spokesperson specified that this involved France’s role ‘in the attacks carried out by Kyiv against Russian civilian economic infrastructure’.

A provision set out in Presidential Decree No. 661, signed by Vladimir Putin on 17 September, which also concerns the Lemano Pro group – formerly Leroy Merlin, transferred in 2023 by the Mulliez family, owners of Auchan, to Scenari Holding, registered in the United Arab Emirates – and the French company FM Logistic. The decree stems from a previous ukaz of April 2023, No. 302, in which Putin authorised the temporary administration of Russian property held by companies or citizens of hostile countries ‘in cases of misappropriation or the risk of confiscation of Russian property abroad, or threats to the country’s security’.

Rejecting accusations of nationalisation, the Russian authorities refer to ‘temporary administration’, without implying a transfer of ownership: in all the cases listed in the decree, management is entrusted to a largely unknown entity called L.E.V. Management. Registered in Moscow in October 2024, with a share capital of 15,000 roubles (155 euros) and unknown ownership: yet, as reported by the independent business website The Bell, a week before the decree was signed, a certain Andrei Krajushkin became its chief executive. A deputy head of the First Directorate of the Ministry of the Interior for migration affairs, holding the rank of Major General of Police, goes by the same name. As Novaya Gazeta Evropa has verified, the dates of birth of the new chief executive and the general coincide.

Peskov clarified that, as regards the next steps, ‘no decision has yet been taken’. However, in previous cases of foreign assets being transferred into Russian hands – notably in 2023, involving the French firm Danone and the Danish firm Carlsberg – external temporary administration had been merely a first step, followed by the transfer by the state to investors favoured by the Kremlin, at favourable prices. Danone, in particular, ended up in the hands of the family of Ramzan Kadyrov, the strongman in charge of Chechnya. His nephew Yakub Zakuriev, Deputy Prime Minister and Minister of Agriculture, took over the running of the company. Carlsberg Baltika, on the other hand, passed into the hands of Taimuraz Bollojev, an entrepreneur of Ossetian origin described as very close to Putin.

In response to the President’s decree, Nestlé stated yesterday that it was prepared to take ‘all necessary steps to protect its rights and ensure the continuity of its operations in the interests of its shareholders and, in particular, its employees’. By the end of the day, the group’s share price had fallen by 2.3 per cent in Zurich.