NORWAY – Elopak, a leading global supplier of carton packaging and filling equipment has announced its decision to sell its Russian business (JSC Elopak) to local management.
The company will sell 100% of its shares to Packaging Management and Investing, which is owned by the management of JSC Elopak, as reported by Reuters.
The operational activities of Elopak’s Russian business are currently under the control of the local leadership team.
Elopak said that it will continue to refrain from the business’ operations in the country as the new owners will operate it independently.
This decision is the result of many months of consideration, delivering a solution that best secures the future of Elopak’s colleagues in Russia.
In May, Elopak had said it would try to find a buyer for its plant in Russia after suspending all of its activities following Moscow’s invasion of Ukraine.
The sale is not expected to impact Elopak’s business outside of Russia and Elopak does not expect further material financial gains or losses recognized in Q2-22 as a result of concluding the transaction.
The completion of the transaction is subject to approval by the Governmental Commission on the Control over Foreign Investments in Russia.
The agreement allows Elopak to terminate the deal prior to closing if the sale becomes illegal under Norwegian law.
Speaking in a recent interview with Reuters about the group’s St Petersburg plant, Elopak CEO Thomas Körmendi said: “We are exploring all opportunities of what we can do, including selling the plant.”
The St Petersburg plant was the leading supplier of milk carton packaging in the Russian market, he added.
Group operations in Ukraine and Russia accounted for 9% of the company’s revenue, with both affected by the Russian invasion of Ukraine.
Elopak joins a long list of Western companies that have sold their Russian operations to local management following Moscow’s invasion of Ukraine.
Equinor EQNR.OL, whose main owner is the Norwegian state, exited its Russian joint venture in May and transferred its assets to long-term partner Rosneft ROSN.MM.
Other Norwegian companies including Storebrand STB.OL and Orkla ORK.OL has also announced plans to exit the region.
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