May 30, 2016 / 12:57 PM / in 4 years

Finland's Kesko has considered Russian grocery exit, but no talks

HELSINKI/MOSCOW, May 30 (Reuters) - Finland’s second-biggest retailer Kesko has examined selling its grocery operations in Russia after just four years, but said on Monday this had not resulted in any negotiations.

Other Finnish firms have cut their exposure to neighbouring Russia, where business has been hit by the Ukraine crisis, international sanctions, a weak rouble and economic recession.

The Delovoi Peterburg newspaper, quoting unnamed retailers, reported on Monday that Kesko had put its Russian grocery business up for sale, prompting the Finnish retailer to say it had examined the option of selling the operations.

“In a strategic examination, all possible alternatives are considered... But we continue to develop the business in accordance with our strategy,” a spokesman said.

Earlier this year, Kesko announced it was planning to sell or close its loss-making sports goods business in Russia.

Kesko, which opened its first grocery store in Russia in 2012 and now has nine there, with a plan to open two more, said the operation had revenue of 107 million euros ($119 million) last year with a slightly negative result due to investments.

It has a sales target of 500 million euros in 2017 for the business. Kesko also runs a hardware retail venture in Russia.

Of other Finnish firms, media group Sanoma, department store chain Stockmann and retail and wholesale drug company Oriola-KD have recently pulled out of Russia. ($1 = 0.8979 euros) (Reporting by Jussi Rosendahl and Tuomas Forsell in Helsinki, Maria Kiselyova in Moscow; Editing by Alexander Smith)

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