The companies being hammered by the Russian market meltdown

Russian troop movements aren't just scaring the bejesus out of Ukrainians - they're spooking global investors, too.

by Emma Haslett
Last Updated: 14 Mar 2014

In the globalised world of finance, the movement of Russian troops affects everyone: from Danish brewers to German supermarkets. Or, indeed, Austrian and Italian banks, which have, as we reported yesterday, a worryingly high exposure to Ukraine.

On the European markets, the rule of thumb was that the closer you are to Russia, the worse your falls were: here’s a handy map we made of market reactions to the crisis yesterday and overnight. Here are shares losing out:

1. Lenta: -14.2%

Sector: supermarkets
Nationality: Russian
Listed: London

Talk about bad timing: the Russian hypermarket chain floated on London’s stock market on Friday, and has since lost $665m (£400m) of its value, dropping from $4.3bn to $3.64bn as shares fell 14.2%, to $8.45. Shareholders – including US private equity firm TPG – bought up $1bn of shares when it began trading, while chairman John Oliver invested $5m: presumably he’s now 14.2% poorer…

2. International Airlines Group: -2.2%

Sector: aviation
Nationality: British
Listed: London

The parent company of British Airways has only just returned to profit: last week it reported operating profits of €770m (£631m) for 2013, up from a €23m loss the year before. But alas, with the threat of conflict in Russia and the Ukraine pushing oil prices up, investors ran from IAG shares at Concorde speed: shares closed down 2.2% yesterday evening. It can take solace in the fact that its rivals had just as bad a day at the office: easyJet, for instance, lost 1.7%.

3. ITE Group: -15%

Sector: events
Nationality: British
Listed: London

Conference organiser ITE generates 65% of its revenue in Russia, but presumably investors reckon only the bravest will be arranging jaunts to the country in the foreseeable future. And although Ukraine only makes up a tiny 8% of its total profits, that’s still £7m. The biggest threat to ITE is the talk of American trade sanctions: ‘American businesses may pull back’, warned John Kerry yesterday.

4. BP: -2.3%

Sector: oil and gas
Nationality: British
Listed: London, Frankfurt, New York

BP may have been muscled out of its joint venture with Russian firm TNK in 2012, but it still has a (pretty cordial at the moment) relationship with state oil company Rosneft, whose shares dropped 4.1% yesterday. Considering BP owns 19.75% of the company, that’s bad: its total loss was $849m. Ouch. 

5. Carlsberg: -5.4%

Sector: beverages
Nationality: Danish
Listed: Copenhagen

If Carlsberg made global political crises, this wouldn’t be one of them: surprisingly, the company has a 37% share of Russia’s booze market, where its Baltika brand is the most popular beer in the country, and a 27% share of Ukraine’s, making it the country’s second-biggest brewer. In fact, its businesses in Eastern Europe account for a third of its operating profit.

6. Metro: -5.2%

Sector: retail
Nationality: German
Listed: Frankfurt

Retailer Metro has been gearing up to IPO its Russian wholesale business for several months now, hoping to raise €1bn (£823m) in the process. Now, it (rather sensibly) says it is monitoring the situation – although internal sources say it has shelved the plans. ‘The market for any Russia-related transaction is shut,’ someone told Reuters. ‘Metro would have to leave too much money on the table.’

7. Renault -5.3%

Sector: automotive
Nationality: French
Listed: Paris

In 2008, a deal with local car manufacturer AvtoVAZ that obliged it to buy a 67.13% of the firm this year probably sounded like a great idea – after all, Russia is Renault’s third-biggest market. Now, it sounds rather less attractive. By the time the deal is sealed, it will have paid $23bn (£379m) for the company. At least the value of the rouble is dropping…

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