Kremlin seizes Nestle and Auchan assets in escalating retaliation against Europe

Russian President Vladimir Putin signed a decree on September 17 placing the Russian operations of Nestle and Auchan under temporary external administration, handing control to AO L.E.V. Management, a little-known firm registered in Moscow. The Kremlin framed the move as retaliation against “unfriendly” European nations that have provided military support to Ukraine.

Kremlin spokesperson Dmitry Peskov made the connection explicit, pointing to the military aid flowing from Switzerland and France to Kyiv as justification.

What got seized, and how big is the hit

Nestle’s Russian footprint is substantial. The Swiss food giant operates six factories in the country and employs roughly 7,000 people. In 2021, Russian sales generated approximately 2 billion Swiss francs, or about $2.4 billion, accounting for around 2% of the company’s total revenue.

Auchan’s exposure is even larger by headcount. The French retailer runs approximately 230 stores across Russia and employs around 30,000 people. In the first half of 2026 alone, Auchan’s Russian operations produced about 127 billion rubles, roughly $1.5 billion in revenue.

The decree also sweeps in related entities including FM Logistic and Lemana Pro, the company formerly known as Leroy Merlin Russia.

Nestle shares dropped approximately 2% on the Zurich stock exchange following the announcement.

The playbook is familiar

Russia ran the same play in 2023 when it seized operations belonging to Danone and Carlsberg. In both cases, the “temporary administration” label proved to be a polite fiction. The assets were eventually sold to Russian buyers at steep discounts, effectively a forced liquidation dressed up in legal language.

The entity now in charge of these operations raises its own questions. AO L.E.V. Management was established in 2024 and is reportedly led by a general from the Russian Interior Ministry.

Since the full-scale invasion of Ukraine in 2022, Russia has seized over $50 billion in assets from foreign firms under a law targeting companies from nations deemed hostile.

The strategic calculation behind staying

Both Nestle and Auchan had significantly scaled back their Russian operations since 2022. But unlike companies such as IKEA and McDonald’s, which made clean exits early in the conflict, the two European firms chose to maintain a reduced presence.

For the Kremlin, these seizures serve a dual purpose. They punish Western nations symbolically while also transferring productive assets to domestic operators, often at fire-sale prices.

For companies still weighing their options, the Danone and Carlsberg precedent is instructive. Both eventually saw their Russian operations sold to local entities, and the original owners had minimal say in the terms.