Unilever sells Russian subsidiary responsible for personal care products for €520M

Unilever has completed the sale of its Russian subsidiary to Arnest Group for €520 million (US$568.6 million).

The subsidiary manufactured perfume, cosmetics and household products for the FMCG giant. 

Hein Schumacher, CEO of Unilever, says: “Over the past year, we have been carefully preparing the Unilever Russia business for a potential sale. This work has been very complex and has involved separating IT platforms and supply chains, as well as migrating brands to Cyrillic.”

Moscow authorities approved the sale of Unilever’s entire business in Russia, including its four factories. The sale also included its business in Belarus.

“The completion of the sale ends Unilever Russia’s presence in the country,” emphasizes Schumacher.

Arnest Group has previously bought Western assets, including Swedish cosmetics group Oriflame, as companies pulled out of Russia after its invasion of Ukraine in February 2022.

The manufacturer is owned by Russian industrialist Alexei Sagal, who has become one of the key beneficiaries of the country’s largest asset redistribution since the fall of the USSR. 

Sagal has acquired the assets at steep discounts. It bought Heineken for €1 million (US$1.09 million), causing the brewer to lose €300 million (US$328.1 million).

The National Agency on Corruption Prevention of Ukraine previously criticized Unilever for its continued operations in Russia and placed the company on its International Sponsors of War list.

The agency said the food and personal care giant’s “ongoing presence in Russia and its significant taxes to the Russian state budget” had been responsible for it ending up on the list. In response, Unilever highlighted the complexity of exiting Russia while continuing to “condemn the war as a brutal and senseless act by the Russian state.”