On February 21, 2024, it was reported that Danone was considering selling its operations in Russia to the local dairy group Vamin Tatarstan. The deal, as reported by The Financial Times, involves the sale of the Activia brand owner’s business in Russia to the cheese and butter manufacturer for Rbs17.7 billion ($191 million). Mintimer Mingazov, the owner of Vamin Tatarstan, has agreed to pay Rbs10 billion to Danone for its equity and an additional Rbs7.7 billion towards debt servicing.

This development comes as Danone was preparing to unveil its 2023 annual results, amidst the backdrop of the Kremlin seizing the French giant’s Russian operations in July of the previous year. The Russian government, deeming Danone’s assets as falling under new laws targeting businesses from “unfriendly” countries, appointed Yakub Zakriev, Chechnya’s minister for agriculture, to oversee Danone’s operations in Russia.

In response to the Kremlin’s actions, Danone reaffirmed its legal ownership of the seized assets, particularly emphasizing the impact on its Essential Dairy and Plant-Based (EDP) division. The company announced a deconsolidation of these assets, leading to cash impairment charges of approximately €200 million ($216 million).

Despite losing management control, Danone has maintained that it remains the legal owner of its EDP operations in Russia, now rebranded as H&N (Health & Nutrition) since September 2023. All products have since been sold under this new branding. Danone’s statement to Just Food highlighted its focus on ensuring the safety of its employees and protecting the company’s assets and rights amidst ongoing uncertainties.