Kaunas, Lithuania-based Viciunai Group has finally sold its Russian business and processing facility, in a process that members of the company’s board called “the most complex transaction” in its history, forced by its promise to withdraw from Russia following its invasion of Ukraine.
According to a statement from the company, Vicunai Group has sold its factory operating in the Kaliningrad region of Russia and its logistics and trading companies active in seven Eastern countries to the Russian company Ocean Group, effectively withdrawing it from the Commonwealth of Independent States (CIS). Ocean Group has also acquired the right to use the VICI trademark within CIS countries, and Viciunai Group said the Lithuanian “VICI” will be transformd “by expanding the Viciunai Group’s portfolio of trademarks.”
Terms of the transaction were not disclosed by either party.
In total, Ocean Group will receive a portfolio of 15 companies. Seven of the companies are in Russia, Vichiunai-Rus, BaltKo, Fort Trans Logistika, LK Centrus, Frost logistics, RefTerminal, and ViciRusTrans; three are in Belarus, EcoFort, Viciunai Bel, and Viciunai Logistik; and the remaining five are in individual countries: VICI-KAZAKHSTAN in Kazakhstan, Vichiunai Azerbaijan in Azerbaijan, Vicunai KG in Kyrgyzstan, Viciunai Vostok in Uzbekistan, and Vichiunai Sakartvelo in Georgia.
Viciunai Group announced it was divesting of the business in June 2022 in response to Russia’s invasion of Ukraine. At the time, the company said it expected to sell its business by the end of the summer, and later Viciunai Group Board Member Dainius Matijošaitis said the process was going smoothly and that it would be “one of the first manufacturers to withdraw from the Russian market.”
The promises of a quick sell quickly evaporated, and Matijošaitis called the transaction incredibly complex and difficult. The asset sale required the approval of the Russian government’s Foreign Investment Control Commission, and Viciunai said various obstacles prevented the transaction.
“It was not our game, it was played by obscure rules or without any at all, hence we can only state that we finally succeeded and I want to thank the team of advisors and company specialists who had the patience and determination to move consistently in the set direction,” Matijošaitis said. “We hope to overcome the remaining part of the process smoothly and quickly, and then continue our rapid expansion in to Western markets.”
In a company statement, Viciunai said it initially had 15 different proposals for purchasing its Russian business, eight of which were non-Russian companies. However, the company said the Russian institutions, internal order, and decision-making structures changed during the process. Contenders for the purchase also changed and multiple buyers withdrew for “various reasons.”
“There was a time when we thought we were being tricked and that the sale of the companies would not succeed,” Matijošaitis said. “We even considered factory closure options, but such a decision would have meant criminal prosecution for the company’s managers [and] destroyed relationships with international suppliers and creditors from the West.”
Ocean Group was identified as the only potential buyer meeting all criteria needed to sell the factory, but Russia's permission was need to cement the deal.
“The state commission’s permission was only granted this February,” Matijošaitis said. “For now, I will just say that once we received the permission, we did everything to sign the contract as quickly as possible, but even this process was not smooth and without surprises.”
Despite the difficulties, the sale has now been finalized, he said.
"Today I can state that we no longer operate in Russia and the CIS. Period,” Matijošaitis said.
The sale comes as the company is facing increasing scrutiny over its business activities in Russia. In January 2024, Ukraine’s National Agency of Corruption Prevention (NACP) added Viciunai Group to its list of international war sponsors in response to its continued operations in Russia. More recently, Lithuanian retail chain Maxima has considered terminating its contract with the company, LRT reported.
According to LRT, Maxima is considering the move in response to an investigation launched by ...
