- Domino’s Franchise Owner in Russia Declares Bankruptcy
- Cessation of Efforts to Sell Pizza Chain
- Economic Sanctions Impact Western Companies in Russia
The franchise owner of Domino’s in Russia has signaled that it will terminate its branches in the country after declaring bankruptcy.
Due to the “increasingly challenging environment,” DP Eurasia has ceased its efforts to sell the pizza chain’s stores in the country.
Since the invasion of Ukraine and the implementation of economic sanctions, numerous Western companies have severed ties with Russia.
Domino’s, among others, has been criticized for not exiting.
In Russia, DP Eurasia operates 171 Domino’s Pizza locations. It owns 68 of the locations, while 103 are operated by local franchisees.
DP Eurasia announced on the London Stock Exchange on Monday that its Russian subsidiary, DP Russia, would file for bankruptcy rather than pursue a buyer.
“Due to the increasingly challenging environment, DP Russia’s immediate holding company is compelled to take this action, which will result in the termination of the attempted sale process of DP Russia as a going concern and, ultimately, the group’s presence in Russia,” the statement read.
The company previously stated that it was “evaluating its presence” in Russia following the imposition of sanctions.
DP Eurasia owns Domino’s franchisees in Russia and master franchise rights in Turkey, Russia, Azerbaijan, and Georgia.
The Russian economy has faced sanctions since February 2022, when the Ukraine war began.
In the immediate aftermath of the invasion, a significant number of well-known corporations decided to cease operations. Also under pressure to act were multinational corporations such as McDonald’s and Coca-Cola.
There has also been persistent criticism of those who have remained in business.
Unilever, the maker of Dove soap and Cornetto ice cream, has defended its decision to continue operating in Russia, contending that it is “not straightforward” because the Russian government would take over its operations if it left.
According to reports, the company contributed $579 million annually to the Russian economy.
Domino’s Pizza Inc., an American multinational corporation and master franchiser, stated that its subsidiary companies ceased providing “any support for the Russian market beginning in early 2022.”
