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Moscow has taken control of the Russian subsidiaries of Swiss food giant Nestlé and French retailer Auchan in a renewed crackdown on western companies still operating in Russia that the Kremlin said was linked to “unfriendly” countries.
President Vladimir Putin signed a decree on Thursday evening saying the subsidiaries had been placed under temporary administration and transferred to a shell company called LEV Management.
The crackdown is the first such seizure of western-owned assets since Moscow took control of the Russian subsidiaries of French food group Danone and Danish brewer Carlsberg’s Baltika Breweries in 2023.
Placing an asset under temporary management does not legally amount to a change of ownership. But in practice, it has almost always been the first step towards passing into the hands of Kremlin-linked Russian investors.
Speaking to reporters on Friday, Kremlin spokesperson Dmitry Peskov said Putin’s decision was linked to France’s policy towards Russia. “One of the factors in this decision was that this is an unfriendly country which is now actively involved in military action against our country,” Peskov said.
He did not deny that the companies might change ownership in the future. “For now, this is specifically about the introduction of external management; no other decisions have yet been taken,” he said.
Nestlé, whose global headquarters are in Vevey, Switzerland, said the company was “assessing the situation and its options”.
“Nestlé is committed to taking all necessary steps to protect its rights and ensure continuity of business operations in the interests of all stakeholders, particularly its employees,” the person added. Shares in the company slid just over 2 per cent to SFr76.5 on Friday morning.
Auchan, which is privately held by France’s billionaire Mulliez family, is one of the biggest western retailers left in the country following Russia’s 2022 full-scale invasion of Ukraine, when many western companies exited the market.
Lemano Pro, the former Russian subsidiary of DIY home goods retailer Leroy Merlin, was also placed under temporary management. The Mulliez family transferred operational control of Lemano Pro to United Arab Emirates-registered Scenari Holding in 2023. The Russian subsidiary of FM Logistic, another French company, was also named in Putin’s decree.
Auchan and FM Logistic did not immediately reply to a request for comment. Leroy Merlin declined to comment.
Following the 2023 seizures, Danone and Carlsberg’s subsidiaries were later sold at steep discounts to Russian businesses with links to the Kremlin. Danone Russia was ultimately put under the leadership of a nephew of Ramzan Kadyrov, a Chechen warlord.
Nestlé’s Russia business makes up 2 per cent of the group’s sales, about SFr1.7bn ($2bn) a year.
Barclays analyst Warren Ackerman said that while the Nespresso and KitKat maker no longer included Russia in its financial reporting, the impact would be “far from immaterial”. “The earnings hit could be relatively sizeable,” he said.
Auchan has about 30,000 employees and 230 stores in Russia, according to its website. The retailer does not disclose revenues for its Russian operation, but has said that the business in Russia and Ukraine accounted for just under 10 per cent of group turnover of €15.5bn in the first half of 2025. Its subsidiary is one of Russia’s top 10 retailers.
Nestlé has operated in Russia since the 1990s and, alongside PepsiCo and Mondelez, chose to stay in the country after Putin’s invasion of Ukraine, even as scores of western multinationals exited.
UK consumer giant Unilever and Dutch brewer Heineken each sold their Russian subsidiaries to a company owned by industrialist and Kremlin ally Alexei Sagal.
Sagal has snapped up a string of western Russian subsidiaries, including those of US canning giant Ball Corporation and Swedish cosmetics group Oriflame. In July, London-listed Reckitt agreed to sell part of its Russian business to Sagal after it was hit by a new package of EU sanctions.
