Danone wants to sell its Russian business to Vamin from Tatarstan – Kommersant

The French Danone, whose Russian assets were transferred to temporary management by the Federal Property Management Agency, intends to sell them to the Vamin company from Tatarstan, reports Financial Times (FT). The publication refers to several sources and documents. According to them, Vamin belongs to Mintimer Mingazov, who was appointed to the board of directors of H&N (a former subsidiary of Danone in the Russian Federation) after it was headed by Yakub Zakriev.

According to FT, Airat Mukhamadeev, director of a newly created company owned by Vamin, sent a letter to the head of the Russian Ministry of Agriculture, Dmitry Patrushev. Mr. Mukhamadeev wrote that he agreed to pay 17.7 billion rubles. ($191.5 million) for gaining control over the Russian business of Danone. It is assumed that 7.7 billion rubles. of this amount will be used to service the debt of the Russian structure.

Airat Mukhamadeev claims that, according to an independent assessment, “the transaction price represents a 56% discount to the market value of the business.” According to him, to ensure the continuity of the Russian business, Danone agreed to provide support until the end of July 2024, because H&N is still localizing the production of a number of ingredients in order to “maintain the high quality of products to which Russian consumers are accustomed.”

Two unnamed FT interlocutors confirmed that the French group is seeking the sale of the business to Vamin. Danone declined to comment. The deal must still be approved by the Ministry of Agriculture and a government subcommittee.

After the start of the Russian military operation in Ukraine, Danone first announced the suspension of investment projects, and then its intention to reduce its presence in Russia. As a result, in July 2023, President Vladimir Putin transferred foreign shares in the Russian structure of the company to the temporary management of the Federal Property Management Agency. In the same month, Deputy Chairman of the Chechen Government Yakub Zakriev headed Danone’s key subsidiary in Russia is Danone Trade, located near Moscow. F.T. wrotethat Chechen officials manage Danone Russia “without drawing weapons.”

Why buyers of former European assets from the Russian authorities face sanctions, read the Kommersant article “With open arms”.

Laura Keffer