Home › Politics › Putin's takeover of Danone and Baltika stakes
Putin's takeover of Danone and Baltika stakes
Summary
A retrospective on the Russian decree placing two foreign-owned businesses under temporary state control, and on a Seoul pledge to Kyiv that came a day earlier.
What did Moscow do to foreign companies that scaled back in Russia? By 17 July 2023, the answer had become clear: on 16 July, Russian President Vladimir Putin authorised a temporary state takeover of the shares of French agribusiness Danone and of Baltika, the brewer owned by Carlsberg.
The measure was presented as part of a wider response to private companies reducing their business operations in Russia during the war in Ukraine. Danone and Carlsberg's Baltika were named as two of the firms affected, which made the decision a concrete step rather than a general warning.
A wider corporate backdrop
Many private companies have ceased operations in Russia, or donated to Ukrainian organisations and the Ukrainian government, in response to Russia's seizure of Ukrainian territory in 2014 and 2022. Others have applied various sanctions. The Danone and Baltika decision showed the Russian side of that exchange: companies that reduced their presence faced the prospect of having their assets placed under state control, in these two cases temporarily.
Support for Kyiv from Seoul
On 15 July, a day before the decree, South Korean President Yoon Suk-yeol made an unannounced visit to Kyiv and met Ukrainian President Volodymyr Zelenskyy. He announced that South Korea would pledge a further US$150 million in aid to Ukraine.
The two developments came from different directions. One was a pledge of money to Ukraine; the other was a decision by Russia's president to take over shares in foreign-owned businesses. Together they showed how the war was being pursued through finance, trade and corporate ownership as well as on the battlefield.
