AMSTERDAM – Dutch paints and coatings maker Akzo Nobel expects its four plants in Russia to be out of business within a few months due to economic sanctions and a shortage of raw materials, its chief executive told the Financial Times in an interview published on Monday.
“We are pretty realistic that over a month, two month period this will come to a gradual, if not normal phasing out of the business,” CEO Thierry Vanlancker said about Akzo’s Russian operations.
“It’s either because the raw materials aren’t available anymore, or it is because somewhere the main customer may not be able to pay.”
The products Akzo produces for retail and industrial clients in Russia do not fall under any sanctions regime, company spokeswoman Diana Abrahams told Reuters.
However, she said the company’s supply chain in Russia was being affected by the impact of the war in Ukraine and sanctions imposed by Western countries against Russia.
“… it is clear that even products that are not sanctioned are and will be hit. The whole chain from supplies to customers is disrupted,” she said.
Abrahams said Akzo looks on a daily basis to see what it can do to help its 640 employees in Russia and its staff of 17 in Ukraine, without giving further details.
Akzo’s four Russian plants generate annual sales of around 200 million euros ($219 million), or just over 2% of its total revenue of 9.6 billion euros last year.
(Reporting by Bart Meijer; Editing by Susan Fenton)
