The diabolical dilemma of multinationals in Russia: scare or death | Business

The multinationals have few options when it comes to Russia. President Vladimir Putin’s invasion of Ukraine and the resulting sanctions have given many Western companies financial, legal and moral reasons to leave. The threat of expropriation weighed against the hope of finding a foreign buyer will determine how quickly the remaining ones will move.

The rush to get out doesn’t let up. McDonald’s announced on Monday that it had begun the sale of its Russian establishments, which would end the 30-year presence in Russia of the hamburger chain, valued at 181,000 million dollars. Renault is to sell its majority stake in the automaker Avtovaz to a local scientific institute. Follow in the footsteps of L’Oréal Cosmetics Group, that he risks a consumer boycott in other markets if he continues to make money in Russia. The ban on importing Western-made microchips also left tech companies like Apple with no choice but to walk away.

The problem with selling in a hurry is that the buyers are often pro-Kremlin oligarchs, such as Vladimir Potanin, who bought the Russian operations of French bank Société Générale for a nominal sum. One of the reasons consumer groups like Nestlé and Unilever remain in Russia is that leaving would mean handing over their assets to the Putin regime.

Waiting could lead to the emergence of a wider range of buyers. For example, India has encouraged its state-owned energy companies to consider buying Russian assets. This could ease the exit of Western oil giants like Shell and BP, which are writing down their combined assets by as much as $30 billion. the brewing giant Anheuser-Busch InBev it sold its Russian joint venture to its Turkish partner Anadolu Efes. The footwear chain FLO, another Turkish company, is in talks to buy some of the Reebok stores.

Some are trying to leave the door ajar: Renault’s sale, which Reuters said was for a token ruble, includes an option to buy back its Russian business for six years. But for companies like the Italian bank UniCredit, which is still exploring possible options for its operations in the country, the delay increases the risk of expropriation by the Russian state. Lawmaker Vyacheslav Volodin recently stated that Russia should confiscate the assets of hostile countries. Multinationals still planning their exit, such as brewers Carlsberg and Heineken, could get the hint. There are many ways for a company to leave Russia, but all of them are bad.

For more information: The authors are columnists for Reuters Breakingviews. The opinions are yours. The translation is the responsibility of EL PAÍS

He knows in depth all the sides of the coin.


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