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Finland's Paulig sells Russia operations to Indian investor

Published 05/05/2022, 16:01
Updated 05/05/2022, 16:05
© Reuters.

By Marie Mannes

(Reuters) - Privately owned food and drink company Paulig said on Thursday it had sold its operations in Russia to private Indian investor Vikas Soi, joining a scramble among Finnish companies to exit the country amid worries Moscow may seize assets.

Paulig is the third Finnish company mentioned by Russian authorities as an example of foreign companies that could be nationalised. Last week Finland's Fazer and Valio sold their businesses in the country.

It is also the sixth company from the Nordic nation to strike a deal to exit Russia as the country prepares to decide next week if it will join the Western defence alliance NATO, which Russia has warned it against doing.

That has added to fears that Russia could try to blackmail it by halting gas deliveries.

The deal is also likely to underscore concerns that firms in Russia and countries not involved in Western sanctions are snapping up prized assets for a bargain as Western companies rush to comply with sanctions over the Ukraine conflict, as well as threats from the Kremlin that foreign-owned assets may be seized.

Russia is India's biggest arms supplier and New Delhi has not explicitly condemned what Moscow calls its special military operation in Ukraine.

Soi's links with Russia go back over three decades. He studied engineering at Lomonosov Moscow State University of Fine Chemical Technology from 1988 until 1994, according to his profile on professional social network LinkedIn.

He also ran the grocery business of Megapolis, the Russian distribution company owned by Igor Kesaev and Sergey Katsiev, for 16 years, his profile shows.

He left at the end of 2015 and since early 2016 has been managing director of coffee producer Milagro Beverage Co, based in Moscow which has Milagro, D'Arte and Belagio brands, his profile shows.

A Reuters review of business registries and sanctions lists showed Kesaev has been sanctioned in Europe for aiding Moscow's Ukraine invasion.

Paulig's divesture comprises unit Paulig Rus LLC and includes Paulig's operations as well as its coffee roastery in Tver. The deal does not include the Paulig brand, which will be phased out in Russia during the next months.

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