1. Homepage
  2. Equities
  3. Italy
  4. Borsa Italiana
  5. UniCredit S.p.A.
  6. News
  7. Summary
    UCG   IT0005239360


SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

Nervous staff and no bankers: Western firms struggle to exit Russia

07/03/2022 | 08:46pm EDT
FILE PHOTO: Russian President Vladimir Putin addresses participants of the IX Forum of Regions of Russia and Belarus, via video link in Moscow

HELSINKI (Reuters) - For foreign companies still working out what to do with their stranded Russian assets, President Vladimir Putin's seizure of a major oil and gas project is a powerful warning: Move fast or else.

Companies have been wrestling with how to exit in ways that limit the financial impact, do not put employees at risk and, in some cases, offer the opportunity to return in future.

Finnish coffee boss Rolf Ladau was one of the early movers.

When Western governments started slapping sanctions on Russia following its invasion of Ukraine in late February, the CEO of Paulig realised the coffee roasting business there was no longer viable.

Coffee wasn't on sanctions lists, but it was almost impossible to get beans into Russia as freight companies stopped shipping to and from the country. Paying in roubles was getting harder.

Two weeks into the conflict, Ladau decided Paulig would leave, and two months later it did what usually takes as long as a year - find a suitable buyer and seal a deal. In May, Paulig sold its Russian business to private Indian investor Vikas Soi.

More than a thousand Western companies have joined a corporate exodus from Russia - unprecedented in its scale and speed - as they scramble to comply with sanctions and amid threats of retaliation from the Kremlin.

But Paulig is one of a relatively small number that have sold assets or handed over the keys to local managers. A Reuters tally shows fewer than 40, including McDonald's, Societe Generale and Renault, have announced deals.

Interviews with half a dozen executives at companies who have divested assets show the complexity and uncertainty of selling at speed and hefty discounts - and why it may be taking many so long.

The obstacles are huge: confusion has swirled over what the Kremlin would allow foreign companies to do; staff are nervous after government threats of retaliation; sanctions have limited the pool of buyers and there is little time to check them out; sales prices have been steeply discounted; and negotiations are being done virtually because fears of reprisals make it too risky to visit Russia in person.

With Moscow preparing a new law that is expected to come into force soon allowing it to take control of the local businesses of Western companies that decide to leave, the stakes are getting higher.

"If you haven't started the process already or if you still have doubts about it, then it's going to get harder," Ladau told Reuters, speaking before Putin's swoop on the Sakhalin oil and gas project.

"Russia has no interest in letting foreign companies out of the market easily."


Many Western firms have run into problems trying to leave.

Burger King halted corporate support for its Russia outlets in March, but the fast-food chain's roughly 800 restaurants are still open. Lawyers say part of the problem is the complexity of its joint venture-style franchise agreement.

UniCredit has disposed of some assets via swaps but has had to widen the search for potential buyers to countries such as India, Turkey and China.

Four months in, there's little sign companies have found a blueprint for extricating themselves.

Renault sold its share of a lucrative joint venture to the Russian state for a rouble; McDonald's handed over 800 branches to a Siberian businessman for a symbolic sum; both have agreed buyback clauses.

SocGen sold its Rosbank unit to Interros Capital, a firm linked to Russian oligarch Vladimir Potanin.

Many have given the keys to local managers. Almost all have booked hefty writedowns totalling tens of billions of dollars.

Ladau decided against a buyback clause.

"The moral-ethical issues are so serious that we have no room to return to Russia," he said.

Experts say it will be tough for new owners in an increasingly isolated Russia without access to Western goods. The cost of everything from food to energy is soaring and the economy has plunged into recession.

Still, the departures have provided an unexpected windfall to firms and entrepreneurs in Russia and countries outside of sanctions, as they snap up prized assets for a bargain.


One aspect of the exodus highlights its unusual nature: the absence of bankers who would normally play a key role in deals.

Sources say banks have steered clear due to concerns about breaking sanctions.

Instead, companies are relying on lawyers in Russia and international consultants with knowledge of the country to find and vet suitors - making sure they are legitimate, not on sanctions lists and have the financial credentials.

Privately-owned Finnish food company Fazer signed a deal as early as April, selling its Russian bakery business to Moscow-based rival Kolomenskij Bakery and Confectionery Holding.

The speed belies the complications.

At first, Russia threatened to ban exits of listed foreign companies. When the company asked for clarification, its local legal advisers said it could have been a mistake.

The rules could change at any time.

"So everyone was in a terrible hurry," said Sebastian Jagerhorn, head of legal affairs and compliance.

Lara Saulo, who runs the bakery business, said even advisers in Russia gave conflicting advice along the way.

Putin's swoop on Sakhalin on Thursday was clearer.

"Soon they'll retaliate, not just with gas, but in other ways," said a senior executive whose company is struggling to get out.

(Reporting by Essi Lehto and Anne Kauranen in Helsinki; Additional reporting by Valentina Za in Milan; Writing by Josephine Mason; Editing by Mark Potter)

By Essi Lehto and Anne Kauranen

© Reuters 2022
Stocks mentioned in the article
ChangeLast1st jan.
LONDON BRENT OIL -0.32% 98.97 Delayed Quote.24.53%
MCDONALD'S CORPORATION -0.80% 259.28 Delayed Quote.-3.28%
RENAULT -0.31% 30.455 Real-time Quote.0.02%
ROSBANK 0.00% 111.2 End-of-day quote.46.32%
S&P GSCI COFFEE INDEX 1.36% 169.0797 Real-time Quote.-4.20%
SOCIÉTÉ GÉNÉRALE 0.32% 23.35 Real-time Quote.-22.94%
UNICREDIT S.P.A. -0.14% 9.908 Delayed Quote.-26.74%
US DOLLAR / RUSSIAN ROUBLE (USD/RUB) 0.00% 60.6154 Delayed Quote.-19.32%
US DOLLAR / TURKISH LIRA (USD/TRY) 0.01% 17.9458 Delayed Quote.34.51%
WTI -0.25% 93.761 Delayed Quote.21.43%
All news about UNICREDIT S.P.A.
11:49aUnicredit Approves Merger By Absorption Of Crivelli
11:49aUnicredit - approves merger by incorporation of crivelli into un…
08/10Moody's Affirms Ratings Of UniCredit Bank Austria AG, Changes Outlooks To Negative
08/10Moody's affirms ratings of unicredit bank austria ag, changes ou…
08/10UNICREDIT : Moody's aligned UniCredit SpA's outlook with Italian Sovereign. Long Term rati..
08/10Moody's Changes Outlook To Negative On Intesa Sanpaolo, UniCredit, 12 Other Italian Ban..
08/09Unicredit Says Moody's Aligned Unicredit SpA's Outlook With Italian Sovereign ; Long Te..
08/09Unicredit - moody's aligned unicredit spa's outlook with italian…
08/09Emak Obtains $21 Million SACE-Backed Loan from UniCredit
More news
Analyst Recommendations on UNICREDIT S.P.A.
More recommendations
Sales 2022 18 278 M 18 875 M 18 875 M
Net income 2022 3 397 M 3 508 M 3 508 M
Net Debt 2022 - - -
P/E ratio 2022 5,83x
Yield 2022 6,48%
Capitalization 20 036 M 20 690 M 20 690 M
Capi. / Sales 2022 1,10x
Capi. / Sales 2023 1,08x
Nbr of Employees 72 774
Free-Float 91,8%
Duration : Period :
UniCredit S.p.A. Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends UNICREDIT S.P.A.
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus BUY
Number of Analysts 24
Last Close Price 9,91 €
Average target price 14,59 €
Spread / Average Target 47,3%
EPS Revisions
Managers and Directors
Andrea Orcel Chief Executive Officer
Stefano Porro Group Chief Financial Officer
Pietro Carlo Padoan Chairman
Jingle Pang Group Head-Digital & Information Officer
Ranieri de Marchis Co-COO & General Manager
Sector and Competitors