Inditex SA, which runs the Zara and Bershka clothing chains, obtained approval to sell its business in Russia to Daher Group of the United Arab Emirates.
Russia’s commission on foreign investments approved the Zara owner’s withdrawal at the end of March, Deputy Minister of Industry and Trade Viktor Evtukhov said in an interview on state TV Wednesday.
Inditex’s exit from Russia has been months in the making. The Spanish retailer, which also owns brands including Stradivarius and Pull & Bear, announced an agreement with Daher Group in October following the closure of all of its shops in Russia after the invasion of Ukraine.
Under the agreement, Daher will operate in Russia under its own brands but if at some future stage, Inditex wishes to return the country, the deal outlines the possibility of doing so through franchises.
Daher is based in the United Arab Emirates and has links to Azadea, a Lebanese company that operates Inditex franchises in the Middle East.
Russia previously accounted for about 8.5 percent of Inditex’s total operating profit and was the company’s second-largest market by number of stores.
Daher plans to shift more than 200 stores to four other brand names in May and keep 4,200 employees Inditex had, Evtukhov told newswire RBC, which previously reported the approval, Bloomberg reports.
