In the fifth year of its war in Ukraine, Russia has moved to seize the Russian operations of Nestle and several French retail giants, framing the act as retaliation for Western sanctions. The gesture belongs to a longer human story about the collision of commerce and conflict — of corporations that stayed, believing presence meant protection, now discovering that in a state at war, no private claim is truly secure. More than 40,000 workers wake to find their livelihoods held in the grip of a geopolitical dispute they did not choose, while governments and shareholders count losses measured in b
Russia seizes Nestle and French retail assets in escalating Western sanctions retaliation
Approximately 40,000+ employees of seized companies face uncertain employment and operational continuity in Russia.
Staying offers no protection against state seizure
Mark
Why does Russia bother seizing these assets rather than just letting the companies operate under sanctions?
Mimi
Because it's leverage and messaging combined. Russia can't easily trade with the West anyway, so controlling these operations lets it extract value—either by running them itself, selling them to allies, or using them as bargaining chips. It also sends a signal to any other Western firm still operating there.
Luke
But we should be clear: the actual financial hit to Nestle is probably manageable. Russia is 1% of their sales. The real cost is reputational and strategic—it shows the company can't protect its assets or employees there.
Mark
What happens to the 40,000 employees across all these companies?
Mimi
That's the hardest part. They're now working for Russian state control. Some may keep their jobs, but under different management, different pay structures, different rules. There's real uncertainty.
Luke
And we don't actually know yet what Russia intends to do with these operations. Will they run them? Sell them? That matters enormously for those workers.
Mark
Is this new, or has Russia done this before?
Mimi
It's happened before—Danone in 2023, Carlsberg the same year. But the pattern is accelerating. It's becoming the standard playbook for any Western company still in Russia.
Luke
The key thing is that analysts are calling this a precursor to forced sales or expropriation. So this seizure might not be the final step—it might be the beginning of a longer process we're still watching unfold.
Le Pouls
- Russia has invoked a presidential decree to seize the Russian assets of Nestle, Auchan, and Leroy Merlin — a direct escalation in the Kremlin's campaign of economic retaliation against the West.
- The move sends a chilling signal to any Western firm still operating in Russia: remaining in the country has not bought goodwill, only vulnerability.
- Nestle faces potential write-offs of around $2.1 billion, while Auchan's 241 stores and 33,000-strong workforce now operate under the shadow of state control with no clear path forward.
- France's government has condemned the seizures and demanded reversal, but analysts warn this is likely the opening act of a forced-sale or expropriation process, not a negotiating gesture.
- Over 40,000 employees across the seized companies face deep uncertainty, caught between a Russian state asserting control and Western parent companies with diminishing legal leverage.
In the fifth year of its war in Ukraine, Russia has moved to seize the Russian operations of Nestle and several French retail giants, framing the act as retaliation for Western sanctions. The gesture belongs to a longer human story about the collision of commerce and conflict — of corporations that stayed, believing presence meant protection, now discovering that in a state at war, no private claim is truly secure. More than 40,000 workers wake to find their livelihoods held in the grip of a geopolitical dispute they did not choose, while governments and shareholders count losses measured in billions.
On Friday, Russian authorities moved to seize the Russian operations of Nestle and three French retail companies — Auchan, Leroy Merlin, and a third firm — framing the action as retaliation for Western sanctions over the now five-year-old war in Ukraine. The move is the latest chapter in a pattern that began with the 2022 invasion: most Western corporations left immediately, but some stayed, citing obligations to their workers and communities. Russia responded by making departure nearly impossible — demanding presidential approval for asset sales, or simply taking the assets outright.
Nestle runs six factories in Russia employing around 7,000 people, producing coffee, pet food, infant formula, and confectionery. The company said it was assessing the situation and would act to protect its rights and support its employees. Though the financial exposure is significant in absolute terms — analysts estimate write-offs could reach $2.1 billion, including funds the company has been unable to repatriate — Russia represented just over 1% of Nestle's global sales even before the war. Its share price fell 2.6% in Zurich following the announcement.
Auchan and Leroy Merlin, both controlled by France's Mulliez family, face a starker human scale: Auchan's Russian subsidiary alone operates 241 stores and employs more than 33,000 people. The company said it had sought clarifications from Russian authorities but offered no further comment. France's foreign and economy ministries condemned the seizures and called on Moscow to reverse course.
The playbook is familiar. In 2023, Russia seized Danone's Russian business, which was then sold to a relative of Chechen leader Ramzan Kadyrov; Carlsberg faced the same treatment. Analysts at Jeffries noted that such seizures have historically been a prelude to forced sales or outright expropriation — meaning what Nestle and the French retailers face now may be only the beginning. With more than 40,000 workers across the seized operations now living under state-controlled uncertainty, the message to any Western firm still weighing its presence in Russia has become impossible to misread.
On Friday, Russian authorities moved to seize the Russian operations of Nestle and three French retail companies—Auchan, Leroy Merlin, and a third firm—in what the Kremlin framed as retaliation for Western sanctions imposed over its war in Ukraine, now entering its fifth year.
The seizure represents the latest escalation in a pattern that has unfolded since the 2022 invasion. Most Western corporations abandoned their Russian holdings immediately or ringfenced them as sanctions made ordinary commerce nearly impossible. Some stayed, claiming responsibility to their workers and local communities, though they drastically reduced operations. Russia responded by making exit prohibitively difficult—requiring presidential approval for asset sales or simply seizing holdings outright.
Nestle operates six factories across Russia and employs roughly 7,000 people producing coffee, pet food, infant formula, and confectionery. The company said it was assessing the situation and would take necessary steps to protect its rights and maintain business continuity for all stakeholders, especially employees. Yet the financial exposure, while significant in absolute terms, is modest relative to Nestle's global footprint. Russia accounted for just over 1% of the Swiss firm's total sales before the war; that figure has since fallen from around 2% as Nestle suspended most sales, non-essential imports, advertising, and capital investment while maintaining supplies of essential food items. Analysts at Vontobel estimated the write-off—including funds Nestle has been unable to repatriate—could reach approximately 2.1 billion dollars. Nestle's share price fell 2.6% on the Zurich exchange following the announcement.
Auchan and Leroy Merlin are both controlled by France's Mulliez family, which also owns the Decathlon sports chain. Auchan's Russian subsidiary operates 241 stores, including 62 hypermarkets, and employs more than 33,000 people. The company said Friday it had requested clarifications from authorities regarding Putin's decree but offered no further immediate comment. France's foreign and economy ministries condemned the seizures and called on Moscow to reverse course.
This move follows a well-established playbook. In 2023, Russia seized Danone's Russian business, which was subsequently sold to a relative of Chechen leader Ramzan Kadyrov. Carlsberg faced similar treatment the same year. Analysts at Jeffries noted that asset seizures of this kind have historically preceded forced sales or outright expropriation, suggesting that what Nestle and the French retailers face now may be merely the opening move in a longer process of dispossession. The combined workforce of the seized operations exceeds 40,000 people, all now operating under the shadow of state control and uncertain futures. For Western firms still weighing whether to remain in Russia, the message has become unmistakable: staying offers no protection.
Citations marquantes
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.— Nestle statement
This practice has historically often been a precursor to a forced sale or effective expropriation of operations in the market.— Jeffries analysts
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War & Conflict