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“We are talking about European companies from unfriendly countries,” said Kremlin spokesman Dmitry Peskov, adding that these states were “currently involved in the most active manner in military actions against our country”.
He did not name France or Switzerland. But Russia says Western countries that supply weapons to Ukraine, including France, are effectively parties to the conflict.
Switzerland does not provide arms to Ukraine but has angered Russia by imposing sanctions against it. The Swiss government expressed concern at Putin’s move and said it was supporting Nestle in efforts to have it reversed.
Nestle, maker of Nescafe coffee and KitKat chocolate bars, said it was assessing the situation.
“Nestle is 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,” the company said in a statement.
It declined to comment further on what action it was considering. Nestle shares were down 2.4% at 1340 GMT.
The move comes amid deep strains between Russia and Europe. Many European governments accuse Moscow of waging a campaign of sabotage across the continent, an allegation Russia denies.
TIGHTER CONTROL
Russia has steadily tightened its grip on foreign-owned assets since launching its invasion of Ukraine in 2022. A 2023 decree signed by Putin allows assets from countries Moscow deems “unfriendly” to be placed under temporary administration.
Moscow has also used the framework to raise funds through forced sales, exit taxes and discounts, while rewarding Kremlin-linked insiders.
According to a 2025 estimate by Moscow law firm NSP, the Russian state has seized more than $50 billion of private property, including assets belonging to foreign companies that exited Russia, since the start of the war.
The Russian assets of Nestle and Auchan were transferred to temporary control by L.E.V. Management, a little-known company with no public profile.
Auchan, which runs 230 stores and an online business in Russia, employing about 30,000 people, declined to comment.
TEMPORARY ADMINISTRATION
Nestle has six factories in Russia producing coffee, pet care and infant formula products. It generated sales of about 2 billion Swiss francs ($2.4 billion) in Russia in 2021, the last year it released figures, and has about 7,000 employees there.
That amounted to about 2% of group sales, although analysts estimate the contribution has declined since Nestle scaled back operations in Russia.
Nestle has suspended most sales, non-essential imports and exports, advertising and capital investment in Russia, said Bank Vontobel analyst Jean-Philippe Bertschy, who estimates the country now accounts for around 1% of group sales.
“While negative for sentiment and raising the prospect of an asset impairment or unfavourable disposal, we expect a marginal financial impact, given Russia’s limited contribution to group sales,” he said.
Russia’s Kommersant newspaper previously reported that a company called KS Logistika asked Putin to place Nestle’s assets under temporary administration, arguing that existing management was preventing expansion.
In previous cases, temporary administration has often been followed by state expropriation, with assets later transferred to Kremlin-linked individuals or companies. Peskov said only temporary administration was under consideration for now.
Other Western companies have sold Russian assets or handed them to local managers in response to sanctions or the threat of state intervention.
Nestle has defended its continued presence in Russia by arguing that it supplies essential food products.
Kepler Cheuvreux analyst Jon Cox said the development did not bode well for Nestle.
“Ultimately, Nestle may end up losing those assets — around 2% of its sales and cash tied up in Russia — for the foreseeable future and any compensation is unlikely to be an offset,” he said.
($1 = 0.8242 Swiss francs)
Additional reporting by Dmitry Antonov in Moscow and Makini Brice in Paris. Editing by Mark Trevelyan and Mark Potteri
By: Reuters.com
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