IKEA announced today that it will sell its factories, close its offices and reduce its 28,000-strong workforce in Russia, the latest move by the world’s largest furniture brand to curtail its activities after the Moscow invasion. in Ukraine.
The move came after IKEA recently closed its stores and cut off supplies to Russia amid massive corporate outflows as Western companies rushed to comply with Western sanctions amid threats from the Kremlin to seize foreign assets.
The Swedish company continued to pay the employees and will continue to pay them until the end of August.
It announced today that it sees no possibility of resuming sales in the country, where it opened its first store in 2000, when the future was predictable.
As a result, the owner of the brand, Inter IKEA, which is also responsible for procurement, announced that it will now start looking for buyers for its four factories in Russia, will permanently close two purchasing and logistics offices in Moscow and Minsk. and will reduce staff.
IKEA has 15,000 employees in Russia, while the Ingka Group, which has all IKEA stores in Russia, has 12,500 employees.
“Unfortunately, conditions have not improved and the catastrophic war continues. Businesses and supply chains around the world have been severely affected and we do not see the possibility of resuming operations soon,” the Ingka Group said in a statement. .
Also, the Ingka group, one of the largest owners of shopping malls in the world, maintains open 14 shopping malls in Russia under the name “MEGA”.
The company says it wants to give people access to basic necessities such as clothes, food and pharmacy products, but will continue to assess the situation.
She also declined to comment on her plans for the 17 stores that remain closed, saying in an email that she was “exploring various options”.
The steps so far are different from some other big western companies, such as McDonald’s and the French carmaker Renault, which sold their assets to local buyers and left the country completely.
The retail business remains on hold, IKEA said, but hinted that it may open its doors to the Russians one last time.
“In order to ensure the necessary business process, we are organizing the sale of household items that are in our warehouses for employees and customers. The dates will be announced soon,” IKEA said in a statement, noting that it may donate some stocks to people. who are in need.
However, the sale of surplus stocks and the creation of revenue may raise doubts, given the pressure exerted publicly and politically on companies not to make money from their operations in Russia.
“We looked at a wide range of options before deciding to sell the stock and there was no viable solution,” the company said in an email.
Source: Capital
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