Can Europe shake its Russia links for good?

By Michal Vít, Assistant Professor at the Metropolitan University of Prague and Visiting Professor at South-East European University (NKM).

The German government has confirmed that Russia was responsible for an attempted drone attack at Leipzig/Halle airport last month. Shredded by four years of war, Europe-Russia relations have reached a nadir which no ceasefire deal will rectify. The European Union continues to strengthen sanctions in this context. The latest round, as confirmed by German Foreign Minister Johann Wadephul, will be targeted at individuals that are seen to benefit from close ties to the Kremlin.

European nations, with Germany, France and the United Kingdom most responsible, must do more to scrutinise individuals and corporate entities with ongoing links to the Russian economy and the Putin regime. In strategic sectors like aerospace and energy, this scrutiny is largely in place. But services like finance, law, and consultancy are more opaque. There remain numerous examples of firms that are yet to curb their profits from Russia-related ventures.

Special Situations Investment is the niche of financial niches. Firms in the space seek distressed and failing companies, often in controversial sectors and markets. The aim is to take over at rock-bottom prices, improve performance, and reap the returns.

Njord Partners, a London-headquartered investment manager with pan-European ventures, is one of the biggest names in Special Situations with senior leaders of a certain pedigree. The firm was founded in 2013 by Jakob Kjellberg, a former director at KKR, and Arvid Trolle, once Vice President at Oaktree Capital. Mads Videbæk, another Oaktree alumnus, joined the founders in 2014. Njord then added Stewart Higginson, a ‘hands-on operational specialist’, as Operating Partner in 2015.

Njord and its senior leaders have reasonably high public profiles, formerly receiving coverage in elite outlets like the Wall Street Journal and trading well on ex-KKR and Oaktree pedigree. However, Russia’s full-scale invasion of Ukraine in 2022 was an inflection point for the firm’s reputation. The case of Njord shines a light on the realities of Special Situations and the externalities of these investments.

In 2017, Njord took ownership of RETN, the telecommunications company founded in Russia in 2003. Under Njord’s ownership, with Co-Founder Jakob Kjellberg serving as the Chairman of RETN’s Board of Directors, the company was scaled into a major independent global internet network. With a focus on Eurasia, RETN’s Russian operations became commercially crucial.

RETN’s Russia subsidiary, JSC RetnNet, secured numerous contracts with the Russian state for data infrastructure. In December 2022, nearly a year after the invasion of Ukraine, JSC RetnNet signed a contract with the Kurchatov Institute, the state-controlled nuclear and scientific research center.

Three months before the contract was signed, in September 2022, the Kurchatov Institute was added to the US Bureau of Industry and Security (BIS) Entity List, triggering export control restrictions. That same month, the United Kingdom sanctioned its President, Mikhail Kovalchuk, for pro-war rhetoric, freezing his assets and imposing a travel ban.

Against this backdrop, RETN continued to maintain, and in some areas expand, its commercial activity in Russia.

In February 2023, JSC RetnNet won a contract with GUP TEK, a major Russian state-owned utility monopolist that supplies 48% of all heating, fuel, and energy infrastructure services to the city of St. Petersburg. GUP TEK and its General Director, Ivan Boltenkov, had already been sanctioned by Ukraine immediately following the February 2022 invasion.

JSC RetnNet’s reported customers also included PJSC Rostelecom, Russia’s largest digital services provider, which is part-owned by the state, and Rosbank, the major Russian bank. Both Rostelecom and Rosbank are subject to Western and Ukrainian sanctions, with OFAC explicitly naming Rosbank as a core target in Russia’s financial services sector.

Per company reports for 2022 and 2023, RETN’s total revenue from its Russian operations rose 39% to €24.1 million between 2021 and 2022. Financial statements in the following years decided to not specify Russian revenue as a standalone statistic, making it more difficult to assess the extent to which its exposure to Russia changed post-invasion.

As RETN’s owner, Njord was drawn into scrutiny. Throughout the period in question, Jakob Kjellberg simultaneously served as Chairman of RETN while remaining a Managing Partner and Person with Significant Control (PSC) at Njord.

Perceptions of exposure to the Russian economy may prove difficult to address, especially as the war continues into its fifth year. Njord’s strategy of limiting public engagement over media questions has only left such concerns largely unanswered.

In the UK, the new Burnham government combines skepticism of private investment with strong support for Ukraine. Njord may face renewed scrutiny as an investor with exposure to state-linked commercial enterprises in markets like Russia.

Njord’s buyout in September 2025 of Red Funnel, the ferry operator linking the city of Southampton with the Isle of Wight, certainly opens it to renewed UK media and political interest. Local residents, represented by the community group Caulkheads for Transparency, recently launched a petition demanding transparency over Njord’s management of Red Funnel and connections to Russia.

Community initiatives and investigative reporting by international media have been critical to holding to account the Russian state and its commercial networks. These efforts should not be dimmed, regardless of the many geopolitical issues, not least the war in Iran and the ravages of the climate crisis on Europe, which now dominate the news cycle.