Raiding in Russia’s Wartime Economy

In Russia, the word reiderstvo – corporate raiding – does not mean what it does elsewhere. In the West, it evokes hostile takeovers, proxy battles or boardroom manoeuvres. In Russia, it means something far more coercive: the seizure of businesses and assets through administrative power, legal manipulation or outright force, often with the tacit – or explicit – support of the state. It is a practice that has evolved alongside the Russian market economy itself. From the gangster capitalism of the 1990s to the increasingly centralised state capitalism that has grown stronger under Vladimir Putin’s rule, reiderstvo has remained one of the most reliable instruments of political control.

Power and Property in Contemporary Russia

The origins of modern Russian corporate raiding lie in the violent and legally ambiguous privatisations of the early 1990s. As the Soviet command economy collapsed, property rights were weakly defined and enforcement mechanisms rudimentary. Organised crime, corrupt law enforcement and emerging business groups competed for control. During those years, power resources were used to redistribute private property and the strength of ownership rights depended less on formal law than on one’s ability to secure protection, whether from a gangster or a governor.

Under Putin, reiderstvo was domesticated and bureaucratised. The infamous 2004–05 Yukos affair, in which Russia’s largest oil company was expropriated, signalled a new phase: instead of being associated with the chaotic skirmishes of rival business clans, it became a state-managed process of selective expropriation of even the most valuable assets. The message was unmistakable: property rights existed at the pleasure of the Kremlin. Thousands of lesser seizures followed. What had once been criminal became political and what had been spontaneous became systematic.

By the late 2010s, reiderstvo had become a routine tool of governance, its contours familiar to any entrepreneur. Courts and bailiffs provided a legal veneer for what was essentially the coercive redistribution of assets to associates of those in the highest echelons of power. The practice blurred the boundary between law enforcement and property transfer and served as one of the biggest obstacles to investment in the economy for over two decades.

The War Economy and the New Wave of Seizures

The full-scale invasion of Ukraine in 2022 brought an extraordinary acceleration of this pattern. The exodus of more than a thousand Western firms created a vast inventory of stranded assets – factories, retail chains and energy infrastructure – ripe for redistribution. The state’s response was not a temporary custodianship but a selective transfer of lucrative assets to loyalists.

Among the first and most symbolic moves was the seizure of the Russian subsidiaries of Danone and Carlsberg in mid-2023. Both had begun to divest from Russia and had identified buyers. Instead, presidential decrees placed their assets under the ‘temporary management’ of the Federal Property Agency, de facto expropriation. Danone’s billion-dollar dairy business was handed to Yakub Zakriev, nephew of Chechen leader Ramzan Kadyrov, while Carlsberg’s Baltika Breweries came under the control of a former Putin aide. The message was explicit: political loyalty would now determine who inherited Russia’s corporate spoils.

These were not isolated actions. The same mechanism was applied to Fortum and Uniper, the Finnish and German energy companies; and, more recently, assets linked to Société Générale and Raiffeisen Bank have been placed under ‘special regime’ review. The process followed a consistent formula: Western exit plans were blocked, companies placed under state management, and assets quietly redistributed to insiders.

More telling still has been the extension of raiding to domestic targets, with the state moving to seize Russian-owned firms whose proprietors live abroad or who were judged insufficiently loyal to the Kremlin. In 2023, the property of businessman Dmitry Mazepin – once close to the Kremlin but later distanced from the war effort – was confiscated and transferred to state hands. The same year saw proceedings against the owners of major logistics and metallurgy firms accused of ‘unjust enrichment’ during the sanctions period. Legal justifications have been flexible: courts have ruled that the statute of limitations can be bypassed when revisiting privatisations from the 1990s, effectively reopening decades-old sales.

One striking example involved the Saint Petersburg developer Glavstroy, whose control shifted to figures close to regional authorities after an opaque tax investigation. Another concerned the Smolny Group, targeted through bankruptcy proceedings and pressure from security agencies. In each case, official explanations cited economic irregularities, yet the beneficiaries were invariably connected to the political establishment.

Loyalty as Capital

This new round of reiderstvo is not random predation but instead represents a redistribution of assets designed to bind loyalists closer to the Kremlin, which has fused property and loyalty into a single instrument of control.

The beneficiaries form an emerging ‘wartime business class’: mid-level industrialists, regional figures and executives from state corporations elevated to ownership through state decrees. Their success is not based on entrepreneurial competence but on political performance. In this respect, the leadership’s aim appears intent on cultivating a new, young class of businessmen fully loyal to the Kremlin.

The re-emergence of reiderstvo as a core feature of Russia’s wartime economy underscores the limits of its transformation since 1991. The shift from criminal to bureaucratic raiding reflects not progress but adaptation. The instruments have changed – tax audits instead of hired thugs, presidential decrees instead of contract killings – but the ultimate function remains the same: to ensure that economic power flows from political power.

This model can sustain itself while the wartime economy expands and external isolation creates opportunities for insider enrichment. But as the tempo of growth slows, scarcity will make the politics of ownership more zero-sum in nature. Consequently, the next phase of reiderstvo will not only redistribute assets; it will redefine the boundaries of loyalty itself. Those who have marched in step with the Kremlin since 2022 will be rewarded. Those who wavered – businessmen who delayed declarations of support or quietly relocated assets abroad – will continue to find their vulnerability exposed, perhaps in even greater numbers.

In this sense, the system is both durable and brittle: durable because it fuses the elite’s material interests with the state’s political project; brittle because it leaves no autonomous economic base outside that project. As property becomes an instrument of governance rather than a product of market exchange, every downturn or budget shortfall will trigger another round of raids, further weakening the already weak rule of law within Russia’s elite.

Three decades after the end of central planning, Russia’s market economy remains defined by the same principle of conditional property rights. Reiderstvo which began as a symptom of lawlessness, has become a method of rule. And in wartime Russia, the line between patriotism and expropriation is now perilously thin.