France's Leroy Merlin, a DIY tech giant and one of Russia's main foreign employers, said on Friday it wants to sell all its stores in that country to "local management", more than a year after the conflict in Ukraine began.
Adeo, the parent company of Leroy Merlin, said it "intends to transfer control" of the company, which has operated for 18 years in Russia, its second market after France. The operation "should preserve the jobs of 45,000 employees and strengthen the company's position," the French group, owned by the Mulliez family, said in a press release.
The operation will be carried out under the supervision of the competent authorities in Russia, the press release clarifies, which cites “the work began several months ago in compliance with current regulations.” Several brands owned by the Mulliez family have remained very popular in Russia, despite the invasion of Ukraine by Russian troops. According to her, Leroy Merlin's 113 stores in this country represent between 18 and 20% of the company's total turnover.
230 stores
Adeo announced last year that it was continuing its operations in Russia but suspending all new investments, citing the risk of "expropriation" if it exited, a threat made by Russian authorities. As of mid-2022, Auchan, another commercial brand owned by the Mulliez family galaxy, achieves more than 10% of its sales in Russia for 230 stores.
However, although many French and Western groups have left Russia since the start of the war, the Mulliez family's decision to remain in the country has drawn criticism. In mid-February, the head of Ukrainian diplomacy Dmitry Kuleba thus accused Auchan of becoming “an independent weapon of Russian aggression” after the publication of an investigation by the daily Le Monde, according to which the group contributed to the war.
The decision to leave Russia is costly for Western companies. So last year French bank Societe Generale split from its Russian retail banking subsidiary Rosbank. As a result, more than 3 billion euros were written off from his accounts.
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