Carlsberg to buy Russian unit Baltika Carlsberg said it would buy the shares it does not own in Russian subsidiary Baltika for up to $1.2bn, even as the Danish brewer reported a drop in full-year profit due to weakness in its eastern European operations. The company said that buying the 15 per cent of Russia's largest brewer and then delisting it would be "immediately earnings-enhancing" and give the group "greater operational flexibility." Carlsberg has long been looking for a way to reverse the steady decline in sales from its Russian markets, which have been hit by a combination of spiralling taxes designed to curb alcoholism and intense competition. Russia accounts for about 40 per cent of Carlsberg's beer sales and the Danish group has invested more than $12bn in the country since the 1990s. Carlsberg's market share in Russia over the full year fell 1.8 percentage points to 37.4 per cent, according to data from Nielsen Holdings, while the total market contracted by about 3 per cent. Jørgen Buhl Rasmussen, chief executive, said that a "high level of promotional activities from competitors" had led to this loss of market share, but added that "the steps we've taken to strengthen the business will begin to bear fruit in 2012." Carlsberg said: "By having 100 per cent ownership of Baltika, the company can be fully integrated into the Carlsberg Group which will speed up the implementation of decisions and also make Baltika a vital part of the ... integration which the group has accelerated recently." The news came as Carlsberg reported a 4 per cent fall in full-year pre-tax profits to Dkr7.5bn ($1.3bn) due to the sales declines in Russia, but also higher input and logistics costs, and a higher sales and marketing spend. The company warned that operating profit would be flat in 2012, hit by low single-digit declines in northern and western European markets and sluggish growth in Russia. Shares in the company fell 2.3 per cent to DKr419 in early Copenhagen trading. The year ended on a high as suppliers and drinkers in Russia used the fourth quarter to stock up ahead of a new year tax increase, although this is expected to weigh on January sales figures. Nevertheless, this helped sales in the quarter rise 11 per cent to DKr14.8bn and pre-tax profits climb from DKr373m to DKr1.2bn. Earnings per share rose from DKr2.1 to DKr6.0 in the quarter but were down 4 per cent to DKr33.80 over the year. The dividend is increased 10 per cent to to DKr5.50.