Putin places Nestlé, Auchan under temporary state control in Russia

Russian President Vladimir Putin placed the Russian subsidiaries of Swiss food company Nestlé and French retailer Auchan under temporary state management through L.E.V. Management on 17 September 2026. Kremlin officials cited the companies' origins in countries supporting Ukraine as justification. Both companies stated they are assessing the situation and committed to protecting their rights.

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Decree placing Nestlé Russian subsidiaries under temporary external management
Decree placing Auchan Russian subsidiaries under temporary external management
Decree placing Lemana Pro (Leroy Merlin successor) under temporary external management
Decree placing FM Logistics and Batilogistic assets under temporary external management
L.E.V. Management appointed as temporary administrator for all transferred assets

On 17 September 2026, Russian President Vladimir Putin signed a decree transferring the Russian subsidiaries of Nestlé and Auchan to L.E.V. Management, a Moscow-based firm, for temporary administration. The decree also placed assets of Leroy Merlin's successor company Lemana Pro and logistics firms FM Logistics and Batilogistic under the same temporary management.

L.E.V. Management, established in October 2024, is headed by Andrey Krayyushkin, identified by Russian media as a former first deputy director of the Interior Ministry's migration directorate. The company is registered as a microenterprise with minimal statutory capital and has shown no active operations in available filings.

Kremlin Spokesman Dmitry Peskov justified the measure by stating the companies originate from "unfriendly countries" that support Ukraine militarily. "These are unfriendly countries that are most actively involved in military actions against our country and states that have been engaged in strikes by the Kiev regime on our civilian and economic infrastructure," Peskov said. The Kremlin emphasized this step represents temporary external management only, with no other decisions made at present.

Nestlé operates six facilities in Russia employing more than 7,000 people. The company reported Russian sales of approximately 2 billion Swiss francs (2.4 billion USD) in 2021, representing about 2% of group sales. Since 2022, Nestlé has discontinued certain products like KitKat and Nesquik in Russia but continued producing essential items including infant formula. Auchan operates 230 physical stores and online services in Russia with 30,000 employees. In 2024, Auchan had announced plans to exit the Russian market but operations continued under new ownership.

Both companies stated they are assessing the situation. Nestlé said it "intends to take all necessary measures to protect its rights and ensure continuity of business operations in the interests of all stakeholders, particularly its employees." Auchan Retail Russia and Lemana Pro requested clarifications from authorities, noting all facilities continue operating normally. Nestlé's share price fell 2% in Zurich trading following the announcement.

Temporary asset seizure has become Russia's standard mechanism for nationalizing foreign-owned businesses since April 2023. Previous applications of this procedure have resulted in ownership transfers of companies including French yogurt maker Danone, Danish brewer Carlsberg, and Netherlands-based Heineken, typically followed by sales to Russian entities. Ariston, an Italian appliance maker, remained under original ownership after temporary management, reportedly following high-level negotiations between Italian officials and the Kremlin.

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Politics Business World Ukraine War

#Russia #Asset seizure #ownership transfer #corporate seizure #business operations #sanctions response #state control #sanctions #Ukraine war #Putin

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Why This Matters

Temporary external management of Russian subsidiaries of Nestlé (7,000+ employees; ~2.4 billion USD annual sales) and Auchan (230 stores; 30,000 employees) affects supply chains for infant formula, consumer staples, and retail operations serving Russian consumers. This mechanism, applied since April 2023, has historically preceded ownership transfers to Russian entities within 12–24 months. Nestlé's share price fell 2% following the announcement. Foreign companies operating in Russia face heightened asset seizure risk; domestic suppliers and logistics firms must navigate management transitions. Timeline and conditions for restoring original ownership or commercial sale remain unannounced.

Timeline & Sources

Jan 1, 2022

Wire

Russia invades Ukraine; Nestlé reduces operations and discontinues certain product lines

Jan 1, 2022

Wire

Ukraine war begins; Nestlé begins scaling back Russian operations

Sep 18, 2026

Wire

Kremlin spokesman Peskov explains decree as response to companies' origin in 'unfriendly countries'

Sep 18, 2026

Wire

Kremlin Spokesman Peskov explains decision, citing 'unfriendly countries' status

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