BASF takes $7.9 billion write-down to exit Russia

BASF's oil and gas group, Wintershall Dea, has decided to exit Russia. In a recent statement, Wintershall Dea’s management board said that their exit would be orderly and comply with all laws and regulations. 

“We as the Management Board were aware on 24 February 2022 that this war would have far-reaching consequences. Russia’s war of aggression on Ukraine has brought an era to an end,” the company stated in a press release. “An era of long and intensive economic cooperation spanning decades, creating prosperity for societies and access to affordable energy. “

“In recent decades we have invested in our business in Russia and built-up assets there. As the Management Board of Wintershall Dea AG, we have an obligation to protect these assets. But the dynamically developing limitations imposed by the Russian Government dramatically intervening in operations of Western companies in the country and external interferences in our joint venture operations, have made it impossible for Wintershall Dea to operate in Russia as before.”

The Associated Press is reporting that this transition will cost the company 7.3 billion euros ($7.9 billion) in write-downs. This decision will create a 1.38-billion-euro net loss for BASF in 2022 compared to a 5.5-billion-euro profit in 2021.