What will the Russian economy look like five years from now?

He used these profits to enrich himself personally, amassing a fortune whose true scale remains unknown. To this day, Putin’s actual wealth—entirely stolen—remains undisclosed, though many suspect it is precisely his plundering of the Russian people that has made him the world’s richest person. Yet Putin also leverages state-owned enterprises to funnel kickbacks to allies within Russia’s security apparatus. His close associates have likewise pocketed millions in such kickbacks. Russia’s notoriously powerful security agencies now serve Putin directly. He uses Russia’s security institutions to surveil and intimidate political opponents or critics—and even to kill them outright—fully exploiting their loyalty. Anyone opposing Putin’s bold, Soviet-style tactics of intimidation and assassination is likely already on his payroll—or soon will be intimidated or assassinated. Putin now directly controls the most critical sectors of the Russian economy. Entrepreneurs who maintain good relations with him are permitted to launch and run successful private enterprises—such as Novatek and Sibur. However, anyone refusing to follow Putin’s script quickly discovers how extraordinarily difficult it is to do business in Russia’s heavily bureaucratic environment. In fact, such severe bureaucracy and rampant corruption have rendered Russia an unattractive market for foreign investors—a situation that further damages the Russian economy. Yet following the 2014–2016 financial crisis, Putin worked to further consolidate his control over Russia’s economy. Today, genuinely independent and moderately successful enterprises face mounting pressure to sell out to the government. For example, Magnit—one of Russia’s largest grocery retail chains—faced enormous pressure to sell. Its founder, Sergei Galitsky, wisely sold most of his stake in the company to a state-owned lending institution—proving he was no fool. Though he received $2.5 billion in compensation, he also relinquished ownership of the company he founded and grew into one of the world’s largest grocery retailers. Galitsky was shrewd and played the game well—but others were not so clever. Many of these wealthy individuals grew rich through collusion with the Kremlin, yet refused to sell their businesses to the government. Most of these oligarchs ultimately ended up in exile—or simply imprisoned on fabricated charges. Although the Kremlin tightly controls much of Russia’s economy, space remains for small- and medium-sized enterprises to succeed—provided they avoid attracting Putin’s all-seeing eye. With relatively friendly relations between Russia and the West, numerous Western companies entered Russia to serve its burgeoning middle class. Hundreds of firms—including Nestlé, IKEA, H&M, and Adidas—established operations in Russia, helping boost the country’s economy. However, Russia’s invasion of Ukraine triggered an unprecedented exodus of foreign companies from Russia, costing the Russian economy roughly $200 billion in lost revenue. Major brands withdrawing included Nestlé, which suspended sales of the vast majority of its products regularly imported into Russia. British American Tobacco completely exited its Russian operations, while Philip Morris scaled back manufacturing in Russia and suspended future investments in the country.

Nestlé sold its mainstream vitamin, mineral, and dietary supplement brands—including Nature Made, GNC, and Puritan’s Pride—for over $6.7 billion, involving the Chinese market.

“Sometimes, our decision to focus means exiting certain businesses,” Ferrero once said, referring to Nestlé’s “remaining ice cream business” as just such a case. “It’s strong but small—and it distracts us. This business is ideally suited for Froneri, and Nestlé has agreed to divest it in phases.” Public records show that Froneri is a joint venture established in 2016 by private equity firm PAI Partners and Nestlé, with investments from Goldman Sachs, the Abu Dhabi Investment Authority, and others. Nestlé holds a 50% stake in the joint venture. Froneri ranks second only to Unilever’s Magnum (Magnum Ice Cream) globally and previously operated primarily in European and North American markets. In mainland China and Hong Kong, the ice cream business is currently managed directly by Nestlé. According to Euromonitor International’s Passport database, Nestlé ranks among the top ten players in China’s ice cream market. In mainland China, Nestlé offers multiple well-known ice cream products—including classics like ‘8-Cube’ and ‘Flower Cone’, as well as newer launches in recent years such as ‘Crunchy Shark’ wafer-coated ice cream bars and Oreo-branded ice cream. The Oreo ice cream is produced and sold exclusively by Nestlé in mainland China under a licensing agreement. Foodie Times learned yesterday from industry insiders that, after recording double-digit growth last year, Nestlé’s ice cream business maintained that growth rate in the first half of this year, driven by contributions across multiple channels and product lines. Specifically, growth occurred across foodservice, e-commerce, convenience stores, snack shops, and instant retail—but wholesale channels continued to face pressure. Product-wise, growth stemmed primarily from ‘8-Cube’, ‘Snow Mochi’, Oreo ice cream, and the four-pack foodservice ice cream; ‘Crunchy Shark’ ice cream and imported products—including Drumstick and Flying Fish coated ice cream—also performed well. Additionally, Foodie Times learned from industry sources that Nestlé’s ice cream sales in the first half of this year exceeded RMB 1 billion (approx. USD 140 million), with the Oreo ice cream line—launched two years ago—approaching RMB 200 million (approx. USD 28 million). For the full year 2026, Nestlé’s ice cream sales target is reportedly RMB 1.5 billion (approx. USD 210 million). Available information indicates that, targeting 2026, Nestlé’s ice cream division identified three key strategic priorities: strengthening category development—with emphasis on ‘8-Cube’, ‘Snow Mochi’, and Oreo ice cream; enhancing terminal distribution—including using AI technology to improve freezer operational efficiency; and expanding into emerging channels—including snack shops, convenience stores, instant retail, e-commerce, and membership warehouse stores. Among these, snack shops and e-commerce were Nestlé’s fastest-growing channels last year, both achieving triple-digit growth rates. If all proceeds smoothly, China’s ice cream business will eventually fall under the Nestlé–Froneri joint venture. However, progress on the ice cream transaction appears slower than expected. Earlier, an industry insider told Foodie Times that Froneri has yet to register a local entity in mainland China to absorb Nestlé’s ice cream operations there—suggesting the divestiture may not be announced until year-end or even next year. As of press time, Nestlé had not commented on the progress of disposing of its China ice cream business. Foodie Times will continue monitoring developments. Link: A vibrant international VMS transaction market With growing interest from major consumer goods companies, international acquisitions involving vitamins, minerals, and supplements (VMS) have become notably active recently—especially in the premium health supplement segment.

Nestlé Weighs Options After Kremlin Moves to Seize Russia Business

3 days ago

Nestlé is assessing options to protect its rights after a Russian decree to seize its local business assets. The Swiss food giant operates six factories producing coffee and infant formula, facing potential loss similar to Danone and Carlsberg.

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