Russia Takes Control of Nestlé and Major European Business Assets
Moscow, Friday, 18 September 2026.
President Vladimir Putin placed Russian assets of Nestlé and French corporations under state administration, transferring operational control to a newly formed entity reportedly headed by a Russian Interior Ministry general.
Presidential Decree and Immediate Market Reaction
On September 17, 2026, Russian President Vladimir Putin signed a decree placing the local operational assets of Swiss food giant Nestlé and three major French corporations under temporary state administration [1][2]. The aggressive move marks a significant escalation in Moscow’s systematic expropriation of Western corporate investments, effectively nationalizing critical supply chains [1][5]. Affected entities include French retailer Auchan, the DIY chain Lemana Pro (formerly Leroy Merlin), and logistics group FM Logistic [1][6]. Following the announcement, Nestlé shares declined 2.2% on September 18, 2026, reflecting investor concern over the heightened systemic risk for remaining foreign multinationals operating within the Russian Federation [2]. The Kremlin linked the seizure of these assets to European military support for Ukraine, citing the companies’ countries of origin as unfriendly [3][5].
The Administrative Mechanism: LEV Management
Operational control of the seized assets has been transferred to a company called LEV Management, a Moscow-based firm registered in October 2024 [5][6]. Investigative reports indicate that LEV Management was created only at the end of 2025 and is headed by a Russian Interior Ministry general, having no known business activity prior to this decree [1][6]. On September 10, 2026, Andrei Krayushkin was appointed as the general director of LEV Management, though reports suggest he may be a Russian Interior Ministry major general [5][6]. Kremlin spokesperson Dmitry Peskov confirmed that the government is currently implementing external management, clarifying that no further expropriation decisions have been finalized at this stage [2][3]. Legal analysts note that while the measure does not formally change ownership, such temporary administration has historically served as a precursor to the sale or transfer of Western assets to Russian buyers [5][6].
Financial Exposure and Corporate Response
Nestlé currently maintains six factories and approximately 7,000 employees in Russia, with the country now accounting for roughly 1% of the group’s total sales [5][6]. This represents a decline from approximately 2% prior to the 2022 invasion of Ukraine, indicating a -50 reduction in relative sales contribution over the period [2][6]. Jean-Philippe Bertschy of the Swiss investment bank Vontobel stated he expected the financial impact to Nestlé would be small given Russia’s limited contribution to group sales [1][6]. In a statement, Nestlé said it was 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 [1][2]. The company is currently assessing the situation and its options following the publication of the presidential decree [2][5].
Geopolitical Context and Precedents
This latest seizure echoes Moscow’s 2023 takeover of Danone’s Russian business, which was later sold to a nephew of Chechen leader Ramzan Kadyrov [1][5]. Since a 2023 decree granting Moscow legal authority to place property belonging to entities from unfriendly countries under temporary administration, Russia has seized control of local units from numerous foreign corporations [2][5]. These previous actions include the seizure of Danish brewer Carlsberg and Finnish utility company Fortum [2]. The well-known Nestlé and Auchan did not leave the Russian market after Russia began its full-scale invasion of Ukraine in February 2022 and instead altered operations [4]. Auchan Retail Russia, which employs approximately 30,000 people and operates roughly 230 stores, has requested clarification from Russian authorities regarding the recent decree [5][6].