Shortly after the war in Ukraine began, its president, Volodymyr Zelenskyy, called on Western companies to leave Russia and ensure that not a single dollar would go to the Russians. Hundreds of companies heeded his request, and politicians and activists expected it to cripple the Russian economy and undermine the Kremlin's war effort. However, President Vladimir Putin, who sets the terms for any company wanting to leave Russia in ways that benefit his government, elites, and war, had other plans.
With this introduction, The New York Times—through an extensive investigation by Paul Sonne and Rebecca Ruiz—revealed that Putin turned the exit of major Western companies into unexpected gains for the pro-Russian elite and the state itself. This was achieved by forcing companies that wanted to leave to sell at low prices, handpicking the buyers, and sometimes directly seizing the companies.
The Times' investigation tracked how Putin managed to turn what was expected to be an ordeal into a boon. Western companies exiting Russia announced losses exceeding $103 billion since the war began, according to the Times' analysis of financial reports, due to their departure conditions and ever-increasing taxes, generating at least $1.25 billion last year for the Russian war chest.
Overall, Putin has overseen one of Russia's largest wealth transfers since the fall of the Soviet Union, with vast sectors of industries such as elevators, tires, and paint now increasingly in the hands of dominant Russian players. Even government-owned companies have seized assets of corporate giants like IKEA and Toyota.
Anton Pinsky, a prominent restaurateur who joined Putin's supporters to take over Starbucks, said, "These are definitely good deals for us. We got them cheap… thank you."
Lack of Transparency
Today in Russia, a robust consumer world continues, helping Putin—in line with the investigation—maintain a sense of normalcy despite the war, which has proven to be longer, deadlier, and costlier than expected. Most foreign companies in Russia remain, unwilling to lose the billions invested there over decades.
After being sold, other companies transformed. Krispy Kreme is now "Crunchy Cream," Starbucks was reborn as "Stars Coffee," and the mermaid logo is now a Russian Swan Princess. These companies can buy raw materials locally or import them from friendly states.
Thus, Putin's economic countermeasures have bolstered support among the elites benefited by the war and mitigated the effects of Western ostracism while Ukraine is occupied with short-term necessities like rallying international support. The relative flexibility of the Russian economy allows Putin to play a long-term game, according to the investigation.
Documents, financial records, and interviews with dozens of dealmakers in Russia and across Europe—many of whom spoke on condition of anonymity for fear of reprisals, as per the newspaper—show that Moscow now meticulously manages every exit, requiring companies to navigate a non-transparent system for approval to sell. In some cases, they appeal directly to Putin's friends for intervention.
Kremlin spokesman Dmitry Peskov told The New York Times that "those who leave lose their positions, and of course, their properties are bought at a very low price and taken over by our companies, which do so with pleasure."
However, the wave of departing companies remains strong, signaling globally that Russia is outcast in business terms, and the economy is tense and at risk of exhaustion.
Thus, Putin's handling of Western departures has only reinforced Russia's image as a dangerous place to do business. Some Russian officials recognize that less competition and foreign investment will harm ordinary Russians and the economy in the long run. But Putin scoffs at the notion that departure will be painful, saying, "Did they think everything here would collapse?"
The New York Times investigation noted that the process of Western companies' exit is overshadowed by threats of intimidation and might. Russian authorities have investigated departing companies, interrogated workers, and arrested some local executives, with Putin at the helm of an exit process fraught with risks but operating in Russia’s favor, albeit started with the urgent goal of preserving Russian economic life.
Blocking the Exits
Speaking from the White House two weeks into the war in Ukraine, President Joe Biden boasted that the West was crushing the Russian economy, saying, "The list of international companies and institutions leaving Russia grows by the day."
At that time, things looked bleak for Putin—the Moscow stock exchange was shut down, and the ruble had plummeted. But Putin was preparing his financial response by restricting the movement of funds abroad and requiring "unfriendly countries" companies to get approval before selling their businesses.
Some executives were concerned about what might happen to their Russian employees, factories, and technology if they left; others were reluctant to abandon their investments because of a war that could be short-lived, despite Western pressure to leave.
But some quickly announced their intention to depart—as the newspaper says—and Heineken and Carlsberg announced their exits as soon as buyers were found. Kinross, a Canadian gold mining company, did the same. However, "OBI," a German hardware store chain, went even further, saying it would close all its stores in Russia until it found a buyer.
Yet the Russian government was setting obstacles, urging managers to defy the owning company and keep the stores open, citing consumer protection laws and the absence of an "economic reason" for the closure. Finally, "OBI" struck a deal and ultimately sold for only a few dollars to a businessman, Joseph Lioukomovich not listed on any financial blacklist. In less than a year, "OBI's" owners changed four times, eventually landing with associates of the U.S. sanctioned Russian Senator Arsen P Kanokov and an ally of Chechen President Ramzan Kadyrov appearing on the ownership record.
After "OBI," Moscow agreed to the sale of the "Kinross" gold mine, but with a halved selling price of $340 million. The purchaser, Highland Gold, was later blacklisted by British officials who claimed the gold provided a "significant income for the Russian war effort."
A similar scenario unfolded with other companies in the elevator and tire industries, which were acquired by Russian businessmen. By the summer of 2022, the Russian economy had stabilized, the ruble recovered, and Putin's strategy changed, the newspaper stated.
After overcoming the crisis, the government wanted to do more than keep businesses running. In August of that year, Putin issued a decree requiring companies in key industries to obtain his signature before selling their Russian assets, suddenly subjecting dozens of companies, such as Siemens and Caterpillar, to the whims of the Russian president himself.
The Subcommittee
For most companies trying to leave Russia, a special "subcommittee" was formed to review sales requests, led by Finance Minister Anton G. Siluanov, and included officials from the Kremlin, the central bank, and key ministries. This subcommittee decides whether companies can exit and under what conditions.
Internal minutes reviewed by the newspaper show that the subcommittee wields immense power and scrutinizes details, yet businessmen compete behind the scenes for the most profitable assets, often turning directly to Putin, as per the New York Times' investigation.
This was the case when British-Austrian paper company "Mondi" found a buyer for one its largest mills in Russia and sought government approval for the sale. When the deal was reached, a former KGB agent wrote a letter to the president, directing matters toward a group of investors, including the state-owned company he managed. However, the company did not respond, and the original deal did not go through either, with the subcommittee placing the mill in the hands of a Moscow property developer for much less than the original price.
Eventually, the Kremlin clarified what had been implicit since the Kinross deal, requiring companies to sell with at least a 50% discount. Companies, including Unilever, announced they preferred to stay in Russia rather than letting their assets end up in government hands.
In April, the Russian government issued a decree stating the Russian government could seize foreign assets and place them under the interim supervision of any entity it chose, posing a complete takeover risk to companies.
