The Lithuanian food manufacturer Daumantai owns a factory in Kaliningrad. The company’s manager, a liberal member of the municipal council of Kedainiai, says he has been looking to divest since Russia launched its invasion of Ukraine, but has not been able to do it yet.
Daumantai, a Lithuanian sauce producer, owns a company registered in the Netherlands, which is in turn at two-thirds owner of the Russian company Agroprodukt. The latter also produces tomato and other sauces in Kaliningrad under the trademarks Kaliningradskiy and Slavianskiy Dar (Slavic Gift).
The manager of the factory said that when the war broke out in late February, a wall of silence fell between himself and the parent company in Lithuania.
“They don’t communicate with me now because they have distanced themselves and that’s it,” Arunas Pauliukaitis, the head and 21% owner of Agroprodukt, said. “Shareholders have strictly said that they don’t want to do business here, and we are talking to buyers, we are negotiating. Things are changing every day here.”
A decade ago, Daumantai publicised its new modern factory in Kaliningrad, an investment worth around 4 million euros. The company claimed it was seeking to take a tenth of the Russian tomato sauce market.
The group’s CEO and one of its shareholders, Saulius Grinkevicius, is now keeping a low profile, however.
“That’s it, our relations with the Kaliningrad company have been terminated, we do not have any relations with them. We have told the management to look for a buyer for our shares, we have no other way,” he said.
Grinkevicius is also a member of the Kedainiai Municipal Council where he was elected with the Liberal Movement party. Previously, he served as the mayor of Kedainiai.
According to him, as soon as the war in Ukraine broke out, Daumantai decided to sell its shares in the Russian subsidiary. However, until a buyer is found, there is nothing it can do.
“I do not know anything. I don’t know when the war will end, whether it will end at all, what will happen next. We are selling shares. I do not know for how much, for a euro, for 100, for 1,000 or for nothing, there is nothing more we can do,” he said, commenting on when Daumantai would unload its Russian assets.
Pauliukaitis says that it is difficult for Agroprodukt to simply close the plant because of the laws adopted in Russia to prevent foreign investors from taking capital out of the country.
He fears that the plant could be nationalised and then sold at auction. The company could also face criminal prosecution, he adds.
“It is not as simple as that now. For example, if they conclude that the plant was closed on purpose, I, as a director, could go to jail,” he said.
Another big Lithuanian food manufacturer, Viciunai Group, has also attracted spotlight over its ownership of a production plant in Kaliningrad. The company, which is owned by Kaunas Mayor Visvaldas Matijosaitis, said it would divest from Russia, but had been criticized for dragging its feet. (LRT/Business World Magazine)