The Russian authorities have placed ROCKWOOL's four Russian factories under external administration. ROCKWOOL calls it indisputably illegal.
In connection with the appointment of an external management team, ROCKWOOL CEO Jes Munk Hansen says:
“What we are seeing is an obvious breach of all international rules. It is indisputably illegal by any standard. We intend to use all legal avenues to defend our assets and prevent them from falling into Russian hands”.
“In the current situation, I am pleased that for almost four years we have prevented an oligarch or the Russian state from getting the entire business and profits from our Russian activities. At the same time, we have donated 500 MDKK to the Foundation for Ukraine's Reconstruction”, Jes Munk Hansen continues.
Factories in passive ownership
Since Russia invaded Ukraine in 2022, ROCKWOOL has kept the four factories in passive ownership. Since then, the Russian business has not been supported by the Danish headquarters or any other of the Group’s companies with any kind of expertise, equipment, spare parts, investments, raw materials or anything else.
“We have always believed that passive ownership was the best solution and have not been able to convince ourselves that we should give our business, turnover, and earnings to the Russian state or an oligarch. We have repeated this, and it remains unchanged. That’s how we still feel”, says Jes Munk Hansen and continues:
“ROCKWOOL’s Russian subsidiaries have the entire business and supply chain in Russia. The Russian employees produce goods for the Russian market from Russian raw materials. As such, the business has been able to continue operations without support from the rest of ROCKWOOL. For the same reason, after the invasion, it wasn’t an option to shut down activity in Russia. Instead, we opted for passive ownership”.
Withdrawn 400 million from Russia
During the passive ownership for the past almost four years, ROCKWOOL has focused on withdrawing funds from the Russian business. In total, this has amounted to just over 400 MDKK.
Jes Munk Hansen:
“The Board has been clear that the company and our shareholders must not be placed in a more favourable position than if we had chosen to divest our ownership. Accordingly, over the same period, we have donated half a billion kroner to the Foundation for the Reconstruction of Ukraine”.
At the last three annual general meetings, ROCKWOOL's shareholders have approved donating money to the Foundation for the Reconstruction of Ukraine – a total of 500 MDKK.
“We have not kept our factories in passive ownership to make money, but to prevent assets worth billions of kroner and the profits from being passed on to the Russian state or an oligarch. We have succeeded for almost four years, but with the companies under Russian administration, there is a new situation”, says Jes Munk Hansen and continues:
“We hear rumours that it is precisely the donations to the Foundation for the Reconstruction of Ukraine that have led to the Russian decision to put ROCKWOOL’s Russian companies under administration”.
The Foundation for the Reconstruction of Ukraine deals exclusively with civilian projects in Ukraine and has since the foundation was established in 2023 spent approx. 80 MDKK on, among other things, emergency aid, heaters, school buses, houses, etc., and on preparing the construction of nine apartment buildings in Chernihiv and Mykolaiv with more than 450 apartments in total. Construction will begin in January 2026. The Foundation expects to have used the full 500 MDKK on reconstruction activities by the end of 2028.
During the period under passive ownership, ROCKWOOL's Russian business has paid tax on the Russian business's profit, but it would of course also have done so under any other owner. ROCKWOOL would not have been able to prevent this by divesting or otherwise giving up ownership.
Next steps unclear
ROCKWOOL is now considering its next steps following the Russian state's decision to place companies and factories under external administration. ROCKWOOL will take all available legal steps to prevent the unlawful takeover so that it can maintain control of the factories and ensure they do not remain in the hands of the Russian state or an oligarch.
