As the Russian exit of Zara left the exit

On the days of the complete invasion of Vladimir Putin in Ukraine in 2022 in Vladimir, the owner of Zara, Inditex, announced “the termination” of his Russian operations in what seemed to be a clean pause of his largest market by shops outside Spain.

But the details of their departure have abandoned the world’s largest fashion group, the Bershka, Pull & Bear and Stradivarius brands also had a presence in the country, well located if they choose to return.

By the beginning of 2023, Inditex injected cash into his Russian business, now called New Fashion, just before selling -by a “non -significant” sum to members of a Lebanese family who runs the Spanish group’s franchise in the Middle East, according to the company’s corporate archives and statements.

Replacement brands established by the buyer sell products almost identical to Inditex while based on the same suppliers and occupy their former staff, according to Financial Times research. And under the terms of the agreement, Inditex has the adequate “immediately” and at no cost to convert the agreement into a franchise agreement under which its own brands would return to their old Russian shops.

“It seems to be a game book similar to other” boomerang “withdrawals … or it comes from where the foundations that are pleasant again,” said Kristian Lasslett, a professor at the University of Ulster, who has studied the outings of Western Russian companies.

Inditex told the FT that he did not participate in his old Russian business or supported him in any way, and that “the purpose of the transaction was to sell our business … while retaining our option to re -enter the market through a franchise agreement”.

Inditex was part of the first wave of Western companies to stop doing business in Russia after the complete invasion of Ukraine in February 2022 in Ukraine, suspending operations in the country nine days after the assault launch.

Eight months later he said he would sell the business for an unvived amount in “The Daher Group”, in an ad that revealed little details about the transaction.

Although there is no entity called the Dah Group, Inditex told the FT that he had used the sentence to indicate that the buyer was “part of the group of investment companies belonging to the Dhero family”, whose Azadea group maintains the Inditex franchise in the Middle East.

The entity controlled by Dhero, which now owns the operations of Russia – a company called Mixed R DMCC The website that promises “continuity of an exceptional fashion trip” – was incorporated in September 2022. Shortly afterwards it created new brands that now occupy many of the 243 Russian stores included in the agreement. The shops of Zara, Pull & Bear, Bershka and Stradivarius are now respectively Maag, Dub, Ecru and Vilet.

The new owner depends on some of the same companies as the Spanish group to obtain their products, according to commercial data that show that three of the main providers of Inditex were also the main suppliers of R Mixed, a subsidiary of R Mixed, in 2023 and 2024.

Inditex said it was a normal practice in the industry that the different retailers used the same suppliers and that “it actively assures the total exclusivity of all products sold by their brands.”

However, many of the designs of the new Russian brands have a great resemblance to the products of Zara and other Inditex brands, show images of the online stores of the companies. Inditex said he would not comment on the designs of other brands.

Mixed R insisted that he had no links with Azadea and that an independent team manages his “creative design and purchase functions from Dubai”. He said that Azadea and R DMCC mixed “are totally independent entities, with different actions and without any business connected.”

The corporate records show Mixed R is co-prophet of Hassan Ghaleb Daher and Mohamed Ali Ghaleb Daher, two of the four brothers who co-owned azadea.

Beyond the likeness of the articles, Maag’s first social media campaign for the launch of his Spring/Summer 2023 collection was shot in the same place as a Zara collection at the same time. Both were filmed in Lanzarote by the same Spanish production company, according to Instagram publications of the brands. Inditex said Lanzarote “is a common and common destination for fashion industry image productions.”

In December 2022, two months after the announcement of the agreement, Inditex wrote a RBS9.1BN loan more interest, and then it was worth approximately 120 million euros, in his Russian company, according to the corporate archives that show it and then injected a total of RBS5.7 million euros, more than 65 million euros at that time, in the company during the following four months, before the agreement closed.

Nataliia Rybalko, a researcher at the Kyiv School of Economics, who has studied multinational departures from Russia, said that he could not think of any other example of a western company that put money in the Russian business that came.

“On the contrary, when they leave Russia, companies retreat as many money as possible before sale,” he said.

Paul Ostling, a former Ey World Operations Director, who has previously served as President of the Audit Committee for several contributed Russian companies, said that it was “common sense, operating” that “you usually do not invest in an asset you are willing.”

He said that New Fashion 2023 financial statements showed that Inditex had classified the asset as non -current, as it was put up for sale when the money was injected. “So the question is, why put cash in an asset that is not running and for sale?”

Inditex said that the business had significant operational costs, but there were no sales, that the obligations with the “employees, the local authorities, the owners, etc.

Between the closure of March 2022 of the Russian business and the sale of April 2023, he received more than 800 clothing shipments from his Middle East potential buyer, according to commercial data.

Inditex said he had agreed with the Dahers that the new fashion would import goods before the sale was completed “to facilitate the quick opening of buyer’s operations in Russia.”

Although Inditex and R-Mixed refused to reveal the terms of the sale or amount of money, if any, the Spanish group in January 2023 calculated that the Russian business had a “realizable value” of 183 million euros.

Asked about the revenue of sale, Inditex pointed out the cost of € 231 million to end Russia’s business, saying “the revenue generated by sale was not significant.”

People who knew the operations of Western retailers in Russia said that Inditex’s arrangement with the Dahers was unusual in not containing a traditional repurchase agreement, which usually allows companies to repurchase entities sold in a certain period of time and a certain price.

Instead, the so -called Daher group is “forced” to “immediately” organize a franchise agreement for Inditex in Russia with shops transferred in the event that market circumstances change, according to the terms spread of the agreement.

Dozens of Inditex employees, including designers, brand directors, and buyers, moved to the United Arab Emirates to work for the so -called Dah Group of the new business, according to the people who know the agreement.

New Inditex’s new staff was moved in 2022 before closing the agreement, according to its Linkedin pages, with the rest later, joining the Inditex alumni already employed by the United Arab Emirates company. A person, who was hired by Rs mixed with Inditex as shoe chief in March 2023, joined the Spanish group last month, according to Linkedin.

Inditex said he had provided more than 800 voluntary leaves in 2024, a figure in line with the average of the previous years, noting that, according to the Spanish labor law, this state is not granted by the employer, but that “he is a worker that entrepreneurs must grant”.

At least one of the employees of the Dubai Holder Company follows Inditex staff while on leave, according to the people who know the structure of the Inditex-Daher arrangement.

The above details of the Inditex sale of their Russian business suggest that the Spanish group is better positioned than most Western retailers to re -enter the Russian market.

The Russian media reported this year that Inditex could soon return to the market, in the midst of a wider approach between Moscow and the United States, although people working with Western Russia companies rejected premature reports. Inditex refused to comment on what he described as “misleading rumors.”

“It seems that it is part of a pattern I have observed in some other cases where companies have left Russia and assets have been put in the name of these careful careful companies in the United Arab Emirates, where it is virtually impossible to find information and, therefore, are impossible to examine,” said Lasslett.

“Russia was a very profitable market for some of these western companies like Inditex.

Inditex said his financial statements “in detail, precisely and accurately detailing the transaction explanation.” He added that “he did not comment on opinions, understanding or conclusions that are not based on an informed and accurate analysis.”

Additional reports of Chloe Cornish in Dubai