The head of the private Russian military company Wagner will move to neighbouring Belarus as part of deal to defuse rebellion tensions and the criminal case against him will be closed, the Kremlin said Saturday.

Yevgeny Prigozhin’s troops who joined him in the uprising will not face prosecution and those who did not will be offered contracts by the Defense Ministry, Kremlin spokesman Dmitry Peskov said.

After the deal was reached, Prigozhin said he was ordering his troops to halt their march on Moscow and retreat to field camps in Ukraine, where they have been fighting alongside Russian troops.

The deal appeared to defuse a dramatically escalating crisis that represented the most significant challenge to President Vladimir Putin in his more than two decades in power.

The deal was mediated by Belarusian President Alexander Lukashenko, a staunch Putin ally.

A rebellious mercenary commander said on Saturday he ordered his mercenaries to halt their march on Moscow and retreat to field camps in Ukraine, appearing to defuse a dramatically escalating crisis that represented the most significant challenge to President Vladimir Putin in his more than two decades in power.

Moscow had braced for the arrival of forces from the Wagner Group, a private army led by Yevgeny Prigozhin that has been fighting alongside regular Russian troops in Ukraine, by erecting checkpoints with armoured vehicles and troops on the city’s southern edge. Red Square was shut down, and the mayor urged motorists to stay off some roads.

But Prigozhin announced that while his men were just 200km from Moscow, he decided to turn them back to avoid “shedding Russian blood.”

He did not say whether the Kremlin had responded to his demand to oust Defense Minister Sergei Shoigu. There was no immediate comment from Putin’s government.

Russian servicemen guard an area standing in front of a tank in a street in Rostov-on-Don, Russia. Photo / AP

The announcement followed a statement from the office of Belarusian President Alexander Lukashenko saying he had negotiated a deal with Prigozhin after discussing the issue with Putin. Prigozhin agreed to halt the advance in a proposed settlement including security guarantees for Wagner troops, Lukashenko’s office said, without elaborating.

Putin had vowed harsh consequences for organisers of the armed uprising led by his onetime protege, who brought his forces out of Ukraine, seized a key military facility in southern Russia and advanced toward Moscow.

In a televised speech to the nation, Putin called the rebellion a “betrayal” and “treason.”

“All those who prepared the rebellion will suffer inevitable punishment,” Putin said. “The armed forces and other government agencies have received the necessary orders.”

It wasn’t immediately clear what concessions, if any, Putin may have made to persuade Prigozhin to halt his march.

If he accedes to Prigozhin’s demand to oust Shoigu, Prigozhin would emerge from the crisis as a clear winner in a major blow to Putin’s authority.

If Prigozhin agrees not to press the demand, Putin could award him with more lucrative government contracts like those on which he has built his fortune in the past.

However, it would be awkward and politically damaging for Putin to backtrack after branding Prigozhin a backstabbing traitor.

Some observers speculated that Prigozhin could make concessions such as putting the Wagner Group under federal authority, or he could shift the force’s activities back to Africa, where his mercenaries have been active in recent years.

Early on Saturday, Prigozhin’s private army appeared to control the military headquarters in Rostov-on-Don, a city over 1000km south of Moscow that runs Russian operations in Ukraine, Britain’s Ministry of Defence said.

Wagner troops and equipment also were in Lipetsk province, about 360km south of Moscow, where authorities were “taking all necessary measures to ensure the safety of the population,” said regional Gov. Igor Artamonov, via Telegram.

Yevgeny Prigozhin. The owner of the Wagner private military contractor who called for an armed rebellion aimed at ousting Russia's defence minister, has confirmed in a video that he and his troops have reached Rostov-on-Don. Photo / AP

Authorities declared a “counterterrorist regime” in Moscow and its surrounding region, enhancing security and restricting some movement. On the southern outskirts, troops erected checkpoints, arranged sandbags and set up machine guns. Crews dug up sections of highways to slow the march.

Moscow Mayor Sergei Sobyanin warned that traffic could be restricted in parts of the capital and declared Monday a non-working day for most residents.

The dramatic developments came exactly 16 months after Russia launched its full-scale invasion of Ukraine, Europe’s largest conflict since World War II, which has killed tens of thousands, displaced millions and reduced cities to rubble.

Ukrainians hoped the Russian infighting would create opportunities for its army to take back territory seized by Russian forces.

Ukrainian President Volodymyr Zelenskyy said Moscow was suffering “full-scale weakness” and that Kyiv was protecting Europe from “the spread of Russian evil and chaos.”

The Federal Security Service, or FSB, called for Prigozhin’s arrest Friday night after he declared the armed rebellion.

A Russian armored vehicle stands in a street in the Russian city Rostov-on-Don, where Prigozhin’s private army appeared to control the military headquarters on Saturday. Photo / AP

Prigozhin said earlier on Saturday that his fighters would not surrender, as “we do not want the country to live on in corruption, deceit and bureaucracy.

“Regarding the betrayal of the motherland, the president was deeply mistaken. We are patriots of our homeland,” he said in an audio message on his Telegram channel.

Prigozhin said he had 25,000 troops under his command and urged the army not to offer resistance.

He posted a video of himself at the military headquarters in Rostov-on-Don and claimed his forces had taken control of the airfield and other military facilities in the city without any deaths or even “a single gunshot.” Other videos on social media showed military vehicles, including tanks, on the streets.

The rebellion came as Russia is “fighting the toughest battle for its future,” Putin said, with the West piling sanctions on Moscow and arming Ukraine.

“The entire military, economic and information machine of the West is waged against us,” Putin said.

State-controlled TV networks led their newscasts with Putin’s statement and reported the tense situation in Rostov-on-Don. Some showed social media videos of residents denouncing Wagner troops.

Broadcasters also carried statements from top officials and lawmakers voicing support for Putin and condemning Prigozhin.

In announcing the rebellion, Prigozhin said he wanted to punish the Russian Defense Minister Sergei Shoigu, left. Chief of the Russian General Staff Valery Gerasimov seen to the right. Photo / AP file

In announcing the rebellion, Prigozhin said he wanted to punish Shoigu after he accused Russian government forces of attacking Wagner field camps in Ukraine with rockets, helicopter gunships and artillery. He claimed that “a huge number of our comrades got killed.”

Prigozhin said his forces shot down a Russian military helicopter that fired on a civilian convoy, but there was no independent confirmation.

He also alleged that Gen. Valery Gerasimov, chief of the General Staff, ordered the attacks following a meeting with Shoigu in Rostov, where they decided to destroy the military contractor.

The Defense Ministry denied attacking the Wagner camps.

The 62-year-old Prigozhin, a former convict, has long ties to the Russian leader and won lucrative Kremlin catering contracts that earned him the nickname “Putin’s chef.”

He gained attention in the US when he and a dozen other Russian nationals were charged with operating a covert social media campaign aimed at fomenting discord ahead of Donald Trump’s 2016 presidential election victory. He formed the Wagner mercenary group, which sent military contractors to Libya, Syria, several African countries and eventually Ukraine.

Wagner forces have played a crucial role in the war in Ukraine, but Prigozhin, left, has increasingly criticised the military brass, accusing it of incompetence and of starving his troops of munitions. Photo / AP file

After Putin’s address, in which he called for unity, officials sought to reiterate their allegiance to the Kremlin and urged Prigozhin to back down.

Vyacheslav Volodin, speaker of the lower house of parliament, said lawmakers “stand for the consolidation of forces″ and support Putin.

Foreign Ministry spokeswoman Maria Zakharova echoed that, saying in a Telegram post that “we have one commander in chief. Not two, not three. One.″

Ramzan Kadyrov, the strongman leader of the Chechnya region who used to side with Prigozhin in his criticism of the military, also expressed his full support of Putin’s “every word.

“The mutiny needs to be suppressed,” Kadyrov said.

Even with the confrontation seemingly defused, it appeared likely to further hinder Moscow’s war effort as Kyiv’s forces probed Russian defences in the initial stages of a counter-offensive.

Wagner forces have played a crucial role, capturing the eastern city of Bakhmut, an area where the bloodiest and longest battles have taken place. But Prigozhin has increasingly criticised the military brass, accusing it of incompetence and of starving his troops of munitions.

Prigozhin’s actions could have significant implications for the war. Orysia Lutsevych, the head of the Ukraine Forum at the Chatham House think tank in London, said the infighting could create confusion and potential division among Russian military forces.

“Russian troops in Ukraine may well now be operating in a vacuum, without clear military instructions, and doubts about whom to obey and follow,″ Lutsevych said. “This creates a unique and unprecedented military opportunity for the Ukrainian army.”

Ukrainian soldier Andrii Kvasnytsia, attending a funeral for a comrade, said Prigozhin’s intentions toward Ukraine might be worse than Putin’s, but that the infighting would still benefit the country.

Western countries monitored developments closely. US Secretary of State Antony Blinken spoke with his counterparts in the other G7 countries and the European Union’s foreign affairs representative, his spokesman said, adding that Blinken “reiterated that support by the United States for Ukraine will not change.”

Latvia and Estonia, two Nato countries that border Russia, said they were increasing security at their borders.

The Kremlin said Putin spoke by phone with the leaders of Turkey, Belarus, Kazakhstan and Uzbekistan about the events.

Although there was speculation that Putin had left Moscow, his spokesman Dmitry Peskov denied it.