Kesko takes a critical view of business in Russia

The Finnish Kesko Group is currently taking a critical view of its involvement in Russia due to the political and economic circumstances. In its recent quarterly report, the topics under discussion were the significant increase in risk because of the high level of uncertainty in economic development, complaints about corruption, the unpredictability of official bodies and sudden changes in the laws. In the worst case, this could stop expansion. The Russian press for example, the finance journal Vedomosti, has also reported on this topic.
Kesko started its operations in Russia over 20 years ago in the building materials retail trade and since 2005 has operated in the DIY sector under the name K-Rauta. Of the 13 K-Rauta stores, seven are located in St. Peterburg and six in Central Russia. Moreover, the group also has five self-service stores and 19 sports stores under the brand name Intersport, in Russia.
At the beginning of 2014 the Kesko Group stated that Russia was a key region and announced that they would be investing € 100 mio annually. The DIY chain K-Rauta alone was supposed to expand to 30 stores by 2017, mainly in the Moscow area. However, the expansion programme is now under scrutiny.