IT distributor ELKO Group has joined the mass exodus of firms leaving the Russian market by signing an agreement to sell all its shares in all subsidiaries in Russia due to the international sanctions imposed on the nation for its invasion of Ukraine.
The IT distributor received permission from all parties involved to divest two subsidiaries in Russia: Elko Rus and retail building Absolut. The change of ownership was officially registered on April 25 this year.
The firm halted supplying goods to the Russian market since the start of the war in Ukraine, and along with the change of ownership of ELKO Group's subsidiaries in Russia, the transfer of the respective assets and the separation of business processes has begun on both an operational and systems level.
A transition period has been set for this process, and it will be implemented in several stages over a period of one year, the firm said.
ELKO Group said the risks related to the Russian market will decrease because of this transaction, and it will also improve the capitalisation of the balance sheet of the group. It also expects the equity and interest coverage ratios to improve while the share of borrowed funds will also decrease.
