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Russia Seizes Control of US Food Company Glavprodukt Amid Ukraine War
Moscow has enacted measures to assume control of Glavprodukt, an American-owned food manufacturing business, in a move purportedly aimed at ensuring provisions for its troops engaged in the conflict in Ukraine. The administration of President Vladimir Putin asserts that the requisition of Glavprodukt, a canned goods enterprise, is essential to sustain consistent provisions for Russia’s national guard and defense ministry. Correspondence addressed to Russia’s prosecutor general, reviewed by Reuters, originating from the new leadership at the helm of the food conglomerate, elucidated the rationale underpinning the necessity of the takeover.
Kremlin Justifies Seizure for Military Food Supply
Glavprodukt, under the ownership of Leonid Smirnov, represents the sole United States-based entity subjected to Kremlin authority, following its placement under temporary Russian administration the previous year. President Vladimir Putin initially sanctioned Russian authorities to seize Russia-based holdings of foreign firms in April 2023, specifically targeting nations the Kremlin designated as “unfriendly.” This action was a reprisal for the extensive sanctions imposed by Western nations on Russia, which included the freezing of considerable assets.
Glavprodukt Under Russian Management
Glavprodukt operates as a division within the Universal Beverage Company, an entity over which the Kremlin assumed command the preceding year. The assets were subsequently transferred to the Russian Federal Property Management Agency, also known as Rosimushchestvo.
Contemporaneously, an informed source disclosed to Russian state media that Rosimushchestvo’s intervention was intended to “guarantee food security.”
Legal Disputes Preceded Takeover
In March, Russia initiated legal proceedings against Mr. Smirnov, the proprietor of the canned food enterprise, accusing him of transferring 1.38 billion rubles out of Russia over the preceding two years, according to reports from Russian state media outlets.
However, Mr. Smirnov, in statements to Reuters, refuted these allegations, stating, “Universal Beverage Company unequivocally refutes any misconduct pertaining to the dispersal of dividends from its Russian subsidiaries, which include Glavprodukt.”
Subsequently, the Kremlin proceeded to seize all assets and monetary funds associated with Mr. Smirnov and Glavprodukt.
Owner Denounces “Raid,” Appeals for Intervention
Mr. Smirnov has publicly criticized the seizure, characterizing it as a targeted campaign intended to compel the sale of the canned food business at a diminished valuation. He has appealed to Donald Trump to “intervene and safeguard my company.”
Speaking to The New York Post, he stated, “What is transpiring with my company constitutes a raid under the guise of government seizure and confiscation efforts.”
US Official Previously Indicated Potential Discussions
Marco Rubio, a US Secretary of State, had previously indicated that Russia’s appropriation of Glavprodukt would be “part of the dialogue” with Russian officials as President Trump continues negotiations concerning a ceasefire agreement in Ukraine.