Danone to offload effective control of EDP business in Russia

French food company Danone has decided to begin a process of transferring the effective control of its essential dairy and plant-based business (EDP business) in Russia.

According to Danone, the decision is appropriate for ensuring local business continuity in the long term for its employees, partners, and consumers.

However, the transaction may end up in a write-off of up to €1 billion, said the nutrition food product company.

Danone revealed that during the first nine months of this year, its essential dairy and plant-based business in Russia made up nearly 5% of the company’s net sales. The business is also said to have weakened contribution to the like-for-like sales growth of Danone along with the recurring operating margin.

Danone to offload effective control of essential dairy and plant-based business in Russia. Photo courtesy of Szanand/Wikimedia Commons.

The closing of the deal, which is contingent on regulatory approvals, will see the deconsolidation of Danone’s essential dairy and plant-based business in Russia.

The French food company stated: “Danone’s priority remains to act responsibly and respectfully to its local employees, consumers, and partners throughout the process.”