IKEA scaling down business in Russia, selling factories

MOSCOW. June 15 (Interfax) - IKEA is scaling its business in Russia down, selling its four factories in the country, with retail remaining on hold.

"Businesses and supply chains across the world have been heavily impacted and we do not see that it is possible to resume operations any time soon. As a consequence, Inter IKEA Group and Ingka Group have now each decided to enter a new phase to further scale down the IKEA business in Russia and Belarus," the Swedish furniture giant said in a press release.

"The IKEA Retail business will remain stopped, and the workforce will be reduced, meaning that many co-workers will be affected. In order to support the scaling down process, Ingka Group plans to sell out its home furnishing inventory in Russia," it said.

"The Inter IKEA owned Industry business in Russia will reduce the workforce and start the process of finding new ownership for all four factories," it said.

The MEGA shopping centers will remain open.

IKEA paused operations in Russia on March 4.

IKEA currently has 14 stores in the Mega shopping centers in Russia and several IKEA City stores and several design studios. The company, according to its website, has four factories in Russia: in Yesipovo in the Moscow region, Tikhvin in the Leningrad region, in Veliky Novgorod and in Krasnaya Polyana in the Kirov region.