Schneider Electric to sell Russian ops to local management Schneider Electric has signed a letter of intent to offload its Russian division to local management, writing off up to $315 million (€300 million) in net book value as a result. Jean Pascal Tricoire, CEO at the France-based UPS manufacturer, said it suspended all new investments in Russia after the invasion of Ukraine on …
It's interesting that they are concerned about going through "regulatory approvals" in Russia and not just pulling out ... Sounds to me like they want to keep good faith with the Russians so they have a good chance of walking back in when Putin has finished killing people and nobody is looking any more ... :-(
Maybe they are just trying to ensure benefits and pensions to the extent they can be paid are paid and the Russian staff is treated as fairly as possible after they exit.
Without the group buying power, R&D, and strategic insight growth to the point a meaningful impact is made on the Russian economy is unlikely. With sanctions inducing inflation and currency devaluation the environment is likely to be challenging and there will probably be more job losses, standard of living drops, and effective income cuts but they can still work in the domestic market and provide their part of systems including those used by hospitals schools...
Remember Russians are people too and the real enemy is the government forcing conscripts to fight and any elites who support that.
I stand with Ukraine and support all international entities leaving Russia in protest.
In doing that there is no need to harm the populous and polarise the world at the individual level when a number of governments are being adversarial and childish enough for us all. Leaving in an orderly fashion is protest enough.
The value is definitely lower, but rather than eg. BP mothballing a pipeline project until a new regime, or waiting for it to be 'nationalised' and claiming compensation/insurance they are selling it - to the same oligarchs.
The oligarchs presumably don't care that it would be more efficient in a Ricardian sense if the pipeline was operated by BP - when they just got a $bn infrastructure project for peanuts
I was comparing the sale to continued operation by BP. Comparing the sale to a shutdown is different, but I think the sale still makes sense.
I suspect that they believe there's a good chance that if they held on to the property, but shut it down entirely, the result would be that it just slowly (or not so slowly, people will start stealing stuff) degrades into near-worthlessness, and/or eventually gets nationalised without compensation as the nation further degrades into totalitarianism. Given that scenario, it makes more sense to sell while you can.
"Isn't all this a win for the very Russians we are supposed to be sanctioning?"
NO
If the assets are worthless buying them isn't a win
Russia is set to be going back 30? 50? 75? years
America has come clean that their objective is to break the back of post Soviet Russia -
How's it going Vlad?
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