Russian authorities seized the local operations and assets of Swiss food multinational Nestlé and three French corporate groups on September 17. According to the sources, the Kremlin defended the takeover as a justified retaliatory measure against companies operating within “unfriendly countries” that support Ukraine.
Here is the math. The latest wave of asset confiscations targets the Russian subsidiaries of retail giant Auchan, DIY hardware chain Lemana Pro (formerly Leroy Merlin), and logistics provider FM Logistic.
The Bottom Line
- The Decree: President Vladimir Putin signed an executive order transferring targeted Western subsidiaries to LEV Management, an entity established in late 2025 and led by a Russian interior ministry general, as reported by Novaya Gazeta Europe.
- Nestlé’s Exposure: Analysts at Jeffries estimate that a complete write-off of Nestlé’s Russian business could cost the Swiss firm approximately 1 billion Swiss francs (S$1.5 billion), following a 2.6% drop in its share price on the Zurich stock exchange.
- Retail Footprint: Auchan operates 241 stores and employs over 33,000 workers in Russia, creating severe operational and labor uncertainties as state-backed management takes control.
Anatomy of a State Takeover
The presidential decree issued late Thursday night mirrors prior state-directed expropriations seen during the ongoing conflict, now in its fifth year. In 2023, Moscow executed similar takeovers of French dairy producer Danone and Danish brewer Carlsberg. Those acquired assets were subsequently funneled to domestic buyers or associates of political figures, such as the transfer of Danone’s local unit to a relative of Chechen leader Ramzan Kadyrov.
According to investigative reporting by Novaya Gazeta Europe via Reuters, LEV Management had no prior commercial track record before its creation in late 2025. Jean-Philippe Bertschy, an analyst at Swiss investment bank Vontobel, noted that while Nestlé had already scaled back non-essential operations, the forced transfer formalizes effective expropriation.
| Company | Country of Origin | Local Footprint / Workforce | Estimated Financial Exposure |
|---|---|---|---|
| Nestlé | Switzerland | 6 factories, ~7,000 employees | ~1 billion Swiss francs (S$1.5 billion) write-off risk |
| Auchan / Lemana Pro | France | 241 stores, ~33,000 employees | Undisclosed asset valuation under review |
| FM Logistic | France | National logistics network | Operational assets transferred to LEV Management |
Diplomatic Pushback and Corporate Response
International condemnation followed swiftly. The French foreign and economy ministries released a joint statement demanding that Moscow reverse the decree immediately. Similarly, Swiss officials are evaluating bilateral protections as corporate legal teams scramble to secure remaining capital.
Nestlé management issued a concise statement indicating the firm 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,” while assessing its strategic options. Meanwhile, Auchan Retail Russia confirmed it requested formal administrative clarifications from Russian regulatory authorities regarding the implementation of the decree.
As regulatory hurdles mount and exit pathways narrow, multinational corporations maintaining any physical footprint inside Russia face an increasingly hostile environment where voluntary divestment has been systematically replaced by involuntary state acquisition.
Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute financial advice.
