Moscow Plans to Use Seized US Company to Feed it's Military, Reuters says
The Kremlin is orchestrating plans to utilize Glavprodukt, a U.S.-owned canned food manufacturer seized in October, to supply Russia’s military, according to a document obtained by Reuters.
This move, placing the company under state control, risks complicating U.S.-Russia negotiations aimed at de-escalating the war in Ukraine.
Strategic Seizure Amid Geopolitical Tensions
Glavprodukt, the sole American-owned company expropriated by Moscow, was taken from Los Angeles-based owner Leonid Smirnov and is now managed by Russia’s federal property agency, Rosimushchestvo.
A letter from Glavprodukt’s new state-appointed management to Russia’s prosecutor general, reviewed by Reuters, cites the need to ensure stable production for supplies to the National Guard and Ministry of Defence.
U.S. Secretary of State Marco Rubio has emphasized that Glavprodukt’s treatment will factor into discussions on resetting bilateral relations.
Russia’s industry and trade ministry and Rosimushchestvo did not respond to inquiries regarding the company’s new role.
Legal and Financial Accusations
Russian prosecutors allege Smirnov and his companies illicitly transferred 1.38 billion roubles ($17 million) out of Russia from 2022 to 2024, per a March RBC report.
On March 12, the Moscow Arbitration Court, acting on the prosecutor general’s request, seized Glavprodukt’s assets. A hearing is set for April 18. Smirnov, denying the allegations, called it a “Russian-style corporate raid.”
The prosecutor general’s office did not comment.
Who Benefits from the Expropriation?
The Reuters-reviewed letter highlights beneficiaries.
Rosimushchestvo appointed Glavprodukt’s new director general at the behest of Druzhba Narodov, a food producer that supplied Russia’s National Guard from 2019 to 2020.
A 2018 investigation by Alexei Navalny’s Anti-Corruption Fund noted then-Prime Minister Dmitry Medvedev approved Druzhba Narodov as the Guard’s sole supplier in 2017.
Ownership of Druzhba Narodov is opaque, but 2022 Kommersant reports linked it to Agrocomplex, owned by sanctioned ex-minister Alexander Tkachev.
Reuters could not verify this due to classified records, though both share the agrocomplex.ru email domain. Neither responded to comment requests.
Broader Context of Asset Seizures
Glavprodukt’s seizure aligns with Kremlin strategy.
About a dozen European firms, including Carlsberg and Fortum, have lost Russian subsidiaries via decrees, with more seizures possible.
Russia’s prolonged war in Ukraine has driven defense spending and asset control, especially after 2022 supply chain issues.
As Moscow repositions Glavprodukt for military needs, it prioritizes wartime logistics over international ties, risking further Western friction.