Eden Springs has departed from its origins – Newspaper Kommersant No. 199 (7400) of 10/26/2022

The exodus of foreign business from the Russian Federation, which began with a military operation in Ukraine, continues. A major European supplier of water for home and office, Eden Springs, handed over a local division with a plant in the Moscow region to top management. Market participants predict a decrease in demand for the products of Eden Springs and its competitors during the crisis due to the departure of a number of corporate clients and consumer savings.

A major supplier of water for home and office (Home and Office Delivery, HOD segment) Eden Springs has left the founders of the Russian division, follows from the data of the Unified State Register of Legal Entities. Since 2017, the CEO of the company, Indian citizen Naveen Singh, has become the owner of Eden Springs LLC. His share is pledged to Eden Springs Nederland BV and Carbon Luxembourg Sa rl

According to its own data, Eden Springs serves more than 800 thousand organizations and households in 18 countries, delivering over 710 million liters of water per year, as well as 43 million coffee capsules and 450 tons of coffee. Part of the Primo Water Corporation. The Primo Water materials confirm that the corporation has withdrawn from the Russian business. Additional questions from Kommersant were not promptly answered there. Eden Springs was unable to provide comment on October 25.

Eden Springs entered the Russian Federation in 2014, having bought the European business in the HOD segment from the Swiss Nestle. The Russian division includes a plant in Domodedovo, near Moscow, with a capacity of more than 1.5 thousand bottles with a capacity of 19 liters per hour, according to the website of the Aquamir water distributor. The company operates in Moscow, Moscow region and St. Petersburg. According to a Kommersant source in the industry, Eden Springs considered the possibility of building a second production facility in St. Petersburg, but the project remained unrealized. Over the past five years, Eden Springs’ revenue has decreased from 1.34 billion to 982.43 million rubles. in 2021. Net profit in 2021 was 24.43 million rubles.

According to Kommersant’s interlocutor in the market, the departure of Eden Springs is associated with the current geopolitical crisis due to the military actions of the Russian Federation in Ukraine. At the same time, local business may not have lived up to the company’s expectations, he points out. Anna Molchanova, General Director of Arkhyz Original’s Trade House Delta, notes that competition in the segment of water supply to homes and offices is changing, as additional regulatory measures introduced by the state in the form of labeling, as well as rising costs and difficulties with logistics, reduce the efficiency of a number of players.

Alena Kondratyeva, vice-president of the Union of Juice, Water and Drink Producers, notes that some consumers are switching to buying bottled water for their homes through vending machines, but the majority do not change their habits, so the crisis did not significantly affect the HOD segment. According to the expert, the volume of the segment continues to grow, primarily in terms of money. IDS Borjomi estimated the volume of the Russian market of all bottled water in 2020 at 6.2 billion liters, expecting an annual growth of 5% until 2025.

According to Ms. Molchanova, the exit of Eden Springs from the Russian division is unlikely to lead to radical changes in the company if the business generated good cash flow and equity funds were not a source of funding. Otherwise, product prices and margins can be expected to decline in order to increase sales revenue through revenue growth, she said.

Against the backdrop of a change in ownership, Eden Springs LLC also filed applications with Rospatent for the registration of AquaMerita and Vitale Xellentia trademarks, including for classes related to bottled water and water bottling devices. According to Ms. Kondratyeva, the brand does not play a significant role in this market, moreover, if the design of the label has to be changed, then the design can be made similar to the usual one.

Aleksey Voinov, director of the Aqua-White mineral water plant, predicts that the HOD segment will be negatively affected by the departure of a number of foreign companies from Russia, the desire of employers to reduce office maintenance costs, as well as consumer savings, which are already becoming noticeable in the mineral water market.

Anatoly Kostyrev