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Under pressure from investors and consumers, many Western companies are unwinding their investments, closing stores and pausing sales in Russia.
By The New York Times
After the Russian president, Vladimir V. Putin, ordered the invasion of Ukraine on Feb. 24, multinational companies have been forced to re-examine their ties with Russia. Some, like McDonald’s, PepsiCo and Shell, had built relationships with the country over decades and were faced with untangling complicated deals.
Under pressure from investors and consumers, many Western companies have started to unwind their investments, close stores and pause sales in Russia. Some, after at first taking temporary measures, have revised their plans and decided to exit the country completely. And some that have begun the process of withdrawing from Russia have revealed the financial cost to their businesses.
Most recently, Marriott said restrictions by Western countries “make it impossible for Marriott to continue to operate or franchise hotels in the Russian market.”
Here are some of the actions businesses have announced:
Consumer goods and retail
Adidas said it would suspend sales in Russia, cutting 1 percent from its expected revenue growth this year. The company has about 500 stores in Russia and the former Soviet states.
British American Tobacco said its was exiting its Russian business. Philip Morris, the cigarette maker, suspended planned investments and will reduce manufacturing in Russia.
Canada Goose, said it would cease wholesale and e-commerce sales to Russia.
Danone said it had begun to transfer control of its dairy business in Russia, which accounts for 5 percent of the French company’s sales, in a move it described as “the best option to ensure long-term local business continuity, for its employees, consumers and partners.” The disposal would result in a write-off of up to 1 billion euros, Danone said.
Fast Retailing, the Japanese clothing company that operates Uniqlo, said it would suspend its operations in Russia. The company came under criticism after its chief executive, Tadashi Yanai, told an interviewer that its stores would continue selling clothes in Russia.
is shutting down its business in Russia. The fashion retailer, which had about 170 stores in Russia, paused sales in March. Now, in what the company described as a “winding down process,” the company will reopen stores for a brief period to sell the leftover inventory before exiting the country altogether.
Ikea suspended imports and exports, though it said it would continue to operate its major chain of shopping centers, Mega, in Russia to ensure that customers have access to essentials.
Nestlé said it was suspending sales of “the vast majority” of its prewar volume of products in Russia, including pet food, coffee and candy sold under KitKat and Nesquik brands. It had already halted “nonessential” imports and exports into and out of Russia, alongside advertising and capital investment.
Nike said in March that it was temporarily closing its roughly 116 stores in Russia.
TJX, the owner of T.J. Maxx and Marshalls, promised to divest its equity ownership in Familia, an off-price retailer with more than 400 stores in Russia.
Unilever, which owns brands like Dove and Sunsilk, suspended imports and exports.
Energy
BP said it would sell its nearly 20 percent stake in Rosneft, the Russian state-controlled oil company. It wrote off about $25.5 billion on its nearly 20 percent holding in Rosneft, along with other ventures in the country. That charge, though, is considered a paper loss by analysts, with little relevance to continuing performance.
Exxon Mobil said it would end its involvement in a large oil and natural gas project.
Shell planned to exit its joint ventures with Gazprom, the Russian natural gas giant. In an update to shareholders, the company said that its decision to leave Russia would cost $4 billion to $5 billion in the first quarter alone.
Finance
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