Jamilko to buy Mothercare business in Russia

The Federal Antimonopoly Service has received a petition from IFC Jamilko JSC to acquire Monex Trading LLC. The latter is a structure of the Kuwaiti Alshaya Group, which owns the master franchise of the British brand of children’s goods Mothercare in Russia. At the beginning of the year, it owned 118 outlets in 30 regions of Russia (56 of them are located in Moscow). The revenue of the Russian legal entity in 2021 amounted to 12.9 billion rubles, and the loss was 243 million rubles. The company itself closed its stores in March of this year after the start of the NWO.

Russia accounted for about 20-25% of the company’s global retail sales before the brand was closed. According to Mothercare’s March forecasts, lost profits could be around £500,000 per month (roughly $700,000). Thus, for 8 months of store downtime, she lost about 4 million pounds (about $ 4.7 million).

This summer, it became known that Alshaya Group plans to sell the Russian business to Mothercare, and in September it was reported that Jamilko was claiming to buy out its assets. The latter was founded in 1993 by Khaled Jamil. She is a distributor of New Balance, Kiko, DKNY, Timberland, Salvatore Ferragamo, Wolford, Juicy Couture, Wrangler, Lee, Escada brands. The company operates more than 150 stores in Moscow, St. Petersburg, Yekaterinburg, Sochi and Rostov-on-Don. The revenue of IFC Jamilko JSC for 2021 amounted to 11.2 billion rubles, net profit – 1.2 billion rubles.

Earlier, experts interviewed by Vedomosti estimated the value of the Monex Trading business at 4 billion rubles, while the owner hoped to give up the business for twice as much, optimizing the number of stores and leaving inventories for 3 billion rubles.

Experts believe that Jamilco may continue to develop the Mothercare children’s goods network, but under a new name. It makes sense to buy the Mothercare network not to set everything up from scratch, but to expand an existing format that has growth potential, Anna Lebsak-Kleymans, CEO of Fashion Consulting Group, said earlier.

Nadezhda Tsvetkova, Head of CORE.XP Retail Space Leasing, knows that the chain’s first stores will reopen in December. First, those points will be launched for which there are agreements on the conditions (in many shopping centers, tenants are reviewing them). As lease rights and remaining inventory are being bought, Mothercare’s own branded products will be in stores first, she says. At the same time, according to Tsvetkova, no new deliveries are planned yet, so Jamilko will have to attract new brands. Given the location of the premises in shopping centers and high-quality finishes corresponding to a children’s store, it is logical to keep the profile of goods for children, the expert argues. Moreover, Jamilko’s portfolio, according to her, does not currently have this category of goods.