Foreign companies leaving the Russian market began to face even greater difficulties in selling their business in the country. According to current requirements, the government of the Russian Federation may in some cases approve a transaction for the exit of a foreign company from assets only if it agrees to sell the business at additional discounts. In this respect he is writing Reuters quotes sources.
People speaking to the agency said the government’s foreign investment commission may underestimate the market value of the company’s business. In this case, in order to sell the business, the owner will need to sell the business at an additional 20-30% discount. The Ministry of Economic Development and the Central Bank of the Russian Federation may also influence the evaluation of the transaction.
In addition, the sources emphasized that the Russian authorities would most likely refuse to sell assets worth more than $100 million to a company, such actions significantly complicate the exit of foreigners from the market. Therefore, foreign firms are forced to look for alternative options for the sale of Russian assets.
According to Reuters’ calculations based on the reports, losses from foreign companies have already exceeded $80 billion due to charge-offs and lost profits. Veon, Yandex and Italian bank Intesa Sanpaolo are among those negotiating for the sale of assets in the Russian Federation.
Now foreign companies must either sell their business at a discount of 50 percent or pay taxes of at least 10 percent of the transaction amount in order to leave Russia. Energy companies and banks also need special permission from Russian President Vladimir Putin.
Formerly Heineken Sold Business in Russia to the manufacturer “Prelest” for 1 €.