DANOY Danone (QX)

Danone is one of the most mentioned companies across news items in the last 12 hours, according to Factiva data, after Russia seized control of the French yoghurt maker's and Carlsberg's local operations. A decree was signed on Sunday by Russian President Vladimir Putin to put the local assets under the temporary management of a government property agency. Danone said it was "preparing to take all necessary measures to protect its rights as shareholder of Danone Russia, and the continuity of the operations of the business." The consumer-goods giant also said Russia's decision has no impact of full-year guidance for like-for-like sales growth of 4%-6% and a moderate recurring operating margin improvement. According to Stifel's Pascal Boll, Russia's decision highlights a high level of unreliability of the Russian business framework for Western companies, and isn't good news for Danone. "Danone announced on October 14, 2022 that it would sell its Russian operations as part of its strategic review/portfolio transformation and expects a write-off of up to EUR1 billion in the event of a sale," said Boll in a research note. "In a worst case scenario, the temporary change in control could result in an expropriation and a writeoff of the full amount of EUR1 billion." Dow Jones & Co. owns Factiva. (giulia.petroni@wsj.com)

(END) Dow Jones Newswires

July 17, 2023 11:01 ET (15:01 GMT)

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