Zara finds way to stay in Russia
Spanish clothing conglomerate Inditex, which owns clothing brands such as Zara, Massimo Dutti, Pull & Bear, Oysho, Bershka, and Stradivarius, has reached a preliminary agreement to sell its Russian business.
“Inditex has reached an initial agreement for the sale of its business in the Russian Federation to Daher group… The terms of the transaction, subject to government approval, will enable the preservation of a substantial number of jobs generated by Inditex Group in Russia, as it includes the transfer of most of the lease contracts related to stores,” Inditex said in a statement published on its website on Tuesday.
Sources say that Daher Group already owns the rights to franchise Zara and Massimo Dutti for the Middle East.
Inditex suspended Russian operations on March 5, and the deal with Daher would mean the company would exit the country completely. However, the company hinted that its brands might still return to Russia via a “potential collaboration through a franchise agreement” with Daher.
Earlier, Forbes reported, citing company sources, that four Inditex brands, Zara, Pull&Bear, Bershka, and Stradivarius, would return to Russia next spring under new names.
Inditex closed its stores in Russia shortly after the start of Russia’s military operation in Ukraine. Prior to that, more than 500 stores of different brands of the Spanish holding were operating in the country, bringing it about 8.5% of global profits. Inditex’s losses in the event of a complete withdrawal from the Russian market were estimated at $300 million.
For more stories on economy & finance visit RT's business section
