Danone’s Chechen takeover: inside a Russian expropriation
Business handed to warlord’s nephew has retained much of the French dairy group’s previous management
When a group of Chechens with links to warlord Ramzan Kadyrov showed up this summer to seize control of Danone’s operations in Russia, the company began receiving frightened calls from its staff in the country.
The French dairy group had been close to finalising a Rothschild-brokered deal to leave Russia when the Kremlin declared its local operations, along with those of Danish brewer Carlsberg, had been placed under “temporary external management”.
But while the designation sounded the death knell for Carlsberg’s role in its Russian business, two of whose top former executives now sit in prison, what has followed for Danone has been more of a bizarre stasis.
Much of life at its Russian dairy operations continues as before, with the Chechens largely running the expropriated factories in name only and previous leadership still involved in much of the day-to-day management.
Danone’s new Chechen bosses are “running it basically as an MBA case, fairly professional and without raising too many flags — pulling the guns out and stuff like that,” according to one person close to Russia’s government subcommittee on western assets.
“It is extremely amicable,” the person said. Danone “are not telling the world they have been mistreated. They don’t sound like they are offended”.
Behind the scenes the company is still scrambling to complete the formal sale of its Russian business, according to people familiar with the talks, believing it can still get some money if properly matched with the right Kremlin-approved buyer.
Danone declined to comment.