British American Tobacco (BAT) has agreed to sell its businesses in Russia and Belarus, 18 months after the Russian invasion of Ukraine.

BAT, which is listed on the FTSE 100, said in a statement that it had entered into a formal sales agreement with a consortium led by members of its Russian operations management team. The sale price has not been disclosed.

The invasion in February 2022 led to a mass exodus of Western firms from Russia, with companies including McDonalds and Starbucks pulling operations in the country.

The Kremlin has made it increasingly hard for businesses to remove operations from Russia and obliges companies to pay a large fee to the Government upon the sale of assets. Heineken announced its departure from the country in August, selling its Russian business for €1.

The deal is expected to be completed within the next month, with the Russian and Belarusian businesses set to be known as the ITMS Group post-completion.

BAT operations in Russia include a head office in Moscow, alongside 75 regional offices and a manufacturing facility in St. Petersburg. It also has an office in Belarus.

In a statement, the company said that it will “no longer have a presence in Russia or Belarus and will receive no financial gain from ongoing sales in these markets”.

The firm’s 2022 results were damaged by a £613m charge relating to its Russian and Belarusian businesses. Impairment charges made up most of that amount.

On 30 June, BAT reported, on a constant currency basis, that Russia and Belarus accounted for approximately 2.7% of the group’s revenue and approximately 2.5% of its adjusted profit from operations.

As part of the deal by BAT, the employment terms of its Russian and Belarusian workers will be comparable to their existing terms for a minimum of two years following the completion of the sale.

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