The fall of Stoli, the vodka maker, shows how cyberattacks can push struggling companies over the edge.
Here's what happened: In August 2024, Stoli got hit with ransomware. The attack knocked out their enterprise resource planning (ERP) system. They had to switch to manual operations for everything—even basic accounting.
Now, four months later, two U.S. parts of Stoli (Stoli USA and Kentucky Owl) have filed for bankruptcy. They're $84 million in debt.
But the ransomware attack wasn't their only problem.
Putin's government labeled Stoli as "extremists" because the company helped Ukrainian refugees. Then, Russia seized Stoli's last two distilleries there, worth about $100 million.
The ransomware attack made everything worse because:
- They couldn't give their lenders up-to-date financial reports;
- The lenders said Stoli defaulted on their loans;
- The lenders cut off their access to more money;
- Manual operations slowed everything down;
- Their systems won't be fixed until early 2025.
What's the lesson here?
Cyberattacks that hit companies already dealing with other big problems often can be the final push into bankruptcy reorganization, or put them out of business permanently.
Think about it: Stoli was fighting Putin, dealing with seized assets, and managing debt problems. Then ransomware hit. Game over.
This pattern keeps showing up. Here are three examples or organizations that all closed after ransomware struck:
- Lincoln College (Illinois): This private college ceased operations in May 2022. The school closed after 157 years due to financial challenges made worse by the COVID-19 pandemic, and then a ransomware attack that disrupted enrollment and fundraising efforts.
- Colorado Timberline (Denver): Colorado Timberline, a custom printing and embroidery company based in Denver, abruptly shut down in September 2018. The closure was linked to a ransomware attack that severely impacted the company's operations, leaving employees and customers without warning.
- United Structures of America (Texas): This steel building manufacturer ceased operations in 2015. The company struggled with financial issues, then the ransomware, and ultimately filed for bankruptcy, leading to its closure.
The message is clear: Don't wait until you're struggling to get serious about cyber resilience.
This article originally appeared on LinkedIn here.
