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U.S. Companies Withdraw from Russia

03/13/2022

In support of Government-imposed sanctions, numerous U.S. companies, both public-quoted and private are withdrawing from Russia. The QSRs announcing withdrawal or suspension include:-

  • McDonald's Corporation closing 850 stores, mostly company owned.  McDonald's will continue to pay 62,000 workers at a cost of $50 million per month.
  • Burger King has followed the lead of McDonald’s
  • Yum! Brands subsidiaries, KFC and Pizza Hut will close company-owned restaurants and franchise income will be directed to humanitarian relief.
  • Starbucks has paused operation in 130 stores, but employees will be supported in the near term
  • Papa Johns has suspended support of 185 restaurants operated by franchisees
  • Dunkin! Brands is ceasing operation

 

Multinational beverage and food companies including Coca Cola, Pepsi Cola, Heineken, Nestle and Danone have announced termination of business in Russia including the supply of ingredients and technology.  International banks including Goldman Sachs and JP Morgan-Chase have terminated operations.  It is estimated that Russian banks owe U.S. financial institutions $15 billion, with approximately $95 billion owed to international banks, the majority of which are located in the E.U.

 

A spokesperson for Papa Johns stated, "we are actively supporting a humanitarian effort through financial contributions as well as by donating dry goods and ingredients to feed refugees in Eastern Europe through our partnership with World Central Kitchen".

 

Termination of business in Russia by U.S. QSRs, banking institutions and industrial companies will probably not detract from their earnings. Oil companies and oil-service firms will be adversely affected by substantial write-downs. As yet the multinational pharmaceutical companies are continuing to trade and operate in Russia based on their expressed justification of supporting health care. This has some merit, provided profits are assigned to relief of refugees displaced by the unprovoked invasion of Ukraine and mass evacuation of more than three million innocent women, the elderly and children to neighboring countries. Countless millions of  citizens within the nation have been displaced as a result of indiscriminate bombing and shelling of residential areas in all major cities.