Reducing Activities: company scaling back some business operations while continuing others
Stay Scaling Back
LPP is a Polish clothing manufacturer that designs, manufactures and distributes clothing.
Reducing Activities: company scaling back some business operations while continuing others
Stay Scaling BackThe head office of the Polish LPP SA (manages the clothing brands Reserved, Cropp, House, Mohito and Sinsay) announced the sale of its business in Russia to a Chinese consortium. “As part of the deal, the buyer does not receive the right to use trademarks and brands owned by LPP SA, but will have the right to sell all goods owned by the Russian division of the company,” the company said in a statement. In St. Petersburg, the LPP group had 59 stores. The Sinsay brand had the most stores - 20, Cropp - 13, Reserved - 10, House and Mohito - 8 each. Decreased revenue in 2023 vs 2022.
Left Russia. 30.06.2022: Pilyugina Anna Alexandrovna becomes the new founder of the organization. The record about the founder COMPANY JOINT STOCK COMPANY LPP has been deleted. COMPANY "FAR EAST SERVICES-FZKO" becomes the new founder of the organization. The new owner of "RE Trading" LLC — the Russian division of the Polish retailer LPP — is the UAE-registered company "Farist Services-Fzco". The record of this in the register is dated June 30, 2022. Could be internal transfer deal as LPP continues to operate in Russia and monitors sales under the name "RE" (LLC "RE Trading", tax id: 7725776121). The company keeps delaying finishing the operations in full. Stores and purchases are still controlled by the central in Poland. The American research company Hindenburg Research published a report in which it is said that the Polish company LPP simulated an exit from the Russian market. Before the full-scale invasion began, LPP was developing business in Russia, which became its largest overseas market and generated 19.2% of revenue from 553 stores. In 2022, LPP said it would sell all Russian shares to the Dubai company Far East Services by June, but after that Polish goods continued to arrive in Russia. Despite LPP's claim that they lost 20% of revenue after the full-scale invasion, profits in 2022-2023 are up 13%. “We believe that LPP was able to publish these excellent results because the denial of the Russian business was a complete sham. Far East Services was listed just a day before LPP announced it had reached an agreement to sell its Russian subsidiary,” Hindenburg Research reported. The report says that LPP's Russian operations are still controlled by the head office in Poland. Hindenburg Research sent out secret shoppers and discovered in Russian stores the same clothes that LPP sells in Poland. In addition, the researchers found out that the business planned to modify the barcodes to hide the true origin of the goods and maintain control over the flow of products. Following the publication of Hindenburg Research, LPP shares fell sharply in price. The company considers this a targeted attack on the business.