The French Leroy Merlin, a giant in the sale of DIY equipment and one of the main foreign employers in Russia, announced on Friday March 24 that it wanted to sell all of its stores in this country to a « management local »more than a year after the start of the conflict in Ukraine.
Adeo, the parent company of Leroy Merlin, said “his intention to cede control” of the company, established for 18 years in Russia, its second market after France. This operation “must make it possible to preserve the jobs of the 45,000 employees and to sustain the company’s activity”argues in a press release the French group, owned by the Mulliez family.
The operation will be subject to the approval of the competent authorities in Russia, specifies the press release, which quotes “work started several months ago in compliance with applicable regulations”.
The Mulliez group established for a long time in Russia
Several brands owned by the Mulliez family remained very established in Russia, despite the invasion of Ukraine by Russian troops. Leroy Merlin’s 113 stores in this country represent between 18 and 20% of the company’s total turnover, she told AFP.
Adeo explained last year that it was maintaining its activity in Russia but that it was suspending all new investment, citing the risk of a « expropriation » in case of withdrawal, a threat waved by the Russian authorities. Auchan, another commercial brand belonging to the Mulliez family galaxy, achieves more than 10% of its sales in Russia, for 230 stores, according to figures from mid-2022.
However, while many French and Western groups have withdrawn from Russia since the start of the war, the decision of the Mulliez family to stay in the country has drawn criticism. In mid-February, the head of Ukrainian diplomacy Dmytro Kouleba thus accused Auchan of having become a "full-fledged weapon of Russian aggression" after the publication of an investigation by the daily "Le Monde" according to which the group would have contributed to the war effort of Moscow.
The choice to disengage from Russia has a cost for Western companies. The French bank Societe Generale thus separated last year from its Russian retail banking subsidiary, Rosbank. A withdrawal which had resulted in a charge of more than 3 billion euros in its accounts.
Source : Nouvelobs
I have been working as a journalist for over 10 years. In that time, I have covered the news from all corners of the world, and written about everything from politics to business.I’m now a full-time author, and my work can be found at Global happenings. My aim is to bring you up-to-date news and views on global affairs, in a format that is easy to read and understand.
