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25 Mar 2024

Simon Harvey, Just Food

Russia: Danone receives govt.'s permission to sell assets to local co.

Deal struck over Danone Russia assets, 25 March 2024

Danone has moved a step closer to the disposal of its dairy business in Russia after gaining “regulatory approvals” for a deal for the assets.

The France-headquartered dairy giant confirmed...the company would incur a loss of €1.2bn ($1.3bn) from the sale of its essential dairy and plant-based (EDP) division assets in Russia.

Danone said it expects to close the transaction with Russian dairy producer Vamin Tatarstan, which is owned by local businessman Mintimer Mingazov, in the “coming weeks”.

EDP accounted for 90% of Danone’s business operations in Russia, the company had said previously, with the remainder in infant formula through its specialised nutrition unit.

Just Food approached Danone to clarify the status of that remaining business in Russia and also to ascertain what assets are included in the EDP sale to Vamin Tatarstan in terms of production plants and brand equity.

However, Danone said via a spokesperson...that it could not comment any further.

In a statement...Danone said: “The Russian regulatory approvals required for the disposal of its EDP business in Russia to Vamin R LLC have been obtained.

“Danone launched the transfer process of this business in October 2022. In July 2023, Danone deconsolidated EDP Russia from its accounts after losing the control of the management.”

The closing of the transaction would mark the end of a long-running saga over Danone’s presence in Russia that erupted following Vladimir Putin’s invasion of Ukraine in February 2022.