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Heineken has today announced the completion of the sale of its Russian operations to Arnest Group, expecting a total cumulative loss of €300 million. The Dutch beer giant announced its decision to exit its business in Russia in March last year, stating that its ownership of its Russian business was no longer “sustainable nor viable” within the current environment following the intensification of the war in Ukraine. This morning (25 August 2023) the company revealed that the transaction has received all of the required approvals, concluding the process that it initiated last year. The purchase price for the Heineken Russia business is €1 for 100% of the shares. Buyer Arnest Group owns a major can packaging business and is the largest Russian manufacturer of cosmetics, household goods and metal packaging for the fast-moving consumer goods sector. All remaining assets, including seven breweries in Russia, will transfer to the new owners. Arnest Group has taken responsibility for Heineken’s 1,800 employees in Russia, providing employment guarantees for the next three years. In addition to the Heineken brand, which was removed from Russia in 2022, production of its Amstel beer brand will be phased out within six months. No other international brands will be licensed in Russia, with the exception of a three-year licence for some smaller regional brands, which Heineken said are required to ensure business continuity and secure transaction approval. Heineken says it will provide no brand support and will receive no proceeds, royalties or fees from Russia. As a result of exiting Russia, the expected €300 million losses include cumulative foreign exchange losses relating to Russia currently recorded in equity. This includes a commitment from Arnest Group to repay the historical intercompany debt of the Russian business of approximately €100 million, due to Heineken in instalments. Heineken said the transaction will have a “negligible impact” on diluted EPS, and Heineken’s full-year 2023 outlook is unchanged from the sale. Dolf van den Brink, Heineken’s CEO and chairman of the executive board, said: “Recent developments demonstrate the significant challenges faced by large manufacturing companies in exiting Russia. While it took much longer than we had hoped, this transaction secures the livelihoods of our employees and allows us to exit the country in a responsible manner.”