The court deprived the Dutch X5 Retail Group, which manages the Pyaterochka and Perekrestok retail chains, of rights to Russian business

The Arbitration Court of the Moscow Region upheld the claim of the Ministry of Industry and Trade against the Dutch X5 Retail Group NV regarding the suspension of corporate rights in its Russian subsidiary, LLC Corporate Center ICS 5. Interfax reports this with reference to the retailer’s press service. The company noted that the court decision has not yet been published and its details are unknown.

Having satisfied the claim of the Ministry of Industry and Trade, the court transferred the shares owned by X5 Retail Group NV to the Russian subsidiary. Russian shareholders and ultimate owners of GDR X5 will be required to accept shares of Corporate Center X 5 LLC in proportion to their participation in the Dutch company. For non-Russian holders, this option is allowed, but they will only be able to receive dividends to type C accounts.

Previously, the Russian authorities included LLC “Corporate Center X 5” in the list of economically significant organizations (ESO), which makes it possible for the forced withdrawal of shares owned by a foreign structure. X5 Retail Group NV operates the Pyaterochka, Perekrestok and Chizhik retail chains in Russia, being one of the country’s largest food retailers (more than 21 thousand stores in 67 regions of the Russian Federation).

The main shareholder of LLC Corporate Center X 5 is the structure of Alfa Group CTF Holdings SA (47.86%). As of April 2023, 11.43% of the shares were owned by Axon Trust.

LLC “Corporate Center X 5” is already the third Alfa Group company forcibly removed from foreign control, The Bell notes. Similar decisions were made regarding Alfa Bank and Alfastrakhovanie. Foreign ownership under the new conditions of sanctions has paralyzed corporate governance and the payment of dividends de facto to the Russian company, the publication writes.