Carlsberg steps up Ukraine security amidst tense Russian military standoff

Carlsberg Photo: Niklas Morberg/Flickr
Carlsberg Photo: Niklas Morberg/Flickr
Carlsberg tells it is concerned by Ukraine’s tense military standoff with Russia in Crimea and is ramping-up security but insists it's too early to say how sales could be hit.

A terse diplomatic round will see US secretary of state John Kerry meet his Russian foreign minister Sergei Lavrov today in Paris, in an attempt to resolves the dispute that flared up during the weekend.

Russian troops entered the Crimea – where a significant percentage of the population support the country and identify themselves with it – on Sunday, and surrounded Ukraine military bases in the region.

We asked Carlsberg if they’re had been any disruption for both itself and peers doing business in Ukraine after the occupation – especially in terms of sales and distribution in the east of the country (particularly Donetsk, where there is support for recently deposed president and Russian ally Viktor Yanukovych in his hometown) and Crimea.

‘Staff security our top priority’ -- Carlsberg

In a statement sent to this website this morning, Carlsberg (which employs 1,700 people and is the second largest brewer in Ukraine with breweries in Kiev, Lviv and Zaporizhzhia) told us it “is concerned by the situation in Ukraine and is monitoring events closely”.

“At this time, our top priority is ensuring the safety of our employees. We have taken the necessary actions to step up security and ensure the well-being of our Ukrainian colleagues,”​ the Danish brewer added.

“All three breweries continue to operate as normal. It is too early and not the right time to comment on how the situation in Ukraine may affect our future sales,”​ Carlsberg said.

Asked if Carlsberg were worried that Russia may become a ‘pariah state’ in the West’s eyes – given its exposure in the country, potentially creating problems for the firm, VP of international relations and issues management, Ben Morton, said the brewer had seen “no impact or changes in terms of beer category dynamics”.

“Exchange rates could have an impact depending on developments during 2014,”​ he added.

Heineken does not have any operations in Ukraine – where it employs third-party distributors – and a much lower exposure than Carlsberg in Russia, but financial communications manager, Christine Van Waveren, told the brewer was watching events.

‘Like everyone else, we’re concerned….’ Brewers of Europe

“Like everyone worldwide, we are of course following developments very closely and hope that calm with return to the area soon,”​ she added.

“In Russia we do have a number of breweries and several thousand employees. We are the fourth largest brewer in the country, but the overall contribution of our Russian business to the total Heineken global footprint is a lot smaller than for some of the other global brewers,”​ Van Waveren said.

Given mutterings that the EU could impose trade sanctions on Russia, and potentially invite tat-for-tat measures that would hurt exports, Simon Spillane, spokesman for key trade association Brewers of Europe would not be drawn.

“Like everyone else we are concerned with the events taking place in the region and are monitoring the situation closely. I have no further comment to make at this time.”

Nikolai Lavrynenko, deputy director general of the Ukrainian Association of Beer Producers (UKRPIVO) refused to comment by phone from Kiev this morning; another Ukrainian businessman in Kiev told us: “Crimea is part of Ukraine. The Russians shouldn’t be allowed to come in at gunpoint and hold a referendum.”

Speaking from Kiev, Bate Toms, head of the British-Ukrainian Chamber of Commerce said there had been little impact upon businesses in Ukraine. “The simple answer is that no, there’s not a lot of disruption, except potentially in Crimea, and we don’t know about that region right now. But it doesn’t seem to be too disruptive,”​ he said.

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