GeoPost/DPDgroup quits Russian market

GeoPost/DPDgroup has decided to quit the Russian market in line with international sanctions related to the war in Ukraine and will transfer its 100% subsidiary DPD Russia to a new owner.

The move comes after all leading international express and parcel carriers suspended services to, from and within Russia and Belarus following the attack on Ukraine in late February.

“Deeply shocked”

Announcing its withdrawal from the Russian market, the international division of France’s La Poste Group declared: “We are deeply shocked by the violence of the war in Ukraine and by its devastating impact on the lives of millions of innocent people. We stand in solidarity with international sanctions and apply them without restriction.

“We suspended all GeoPost/DPDgroup shipments to and from Russia on February 28th, 2022. Today, we are taking the decision to withdraw from the Russian market.”

DPDgroup CEO Yves Delmas already said in early March that the group would “follow instructions” (i.e. international sanctions) in deciding whether to withdraw from Russia or not.

Ownership transfer

GeoPost/DPDgroup explained in a statement: “We are currently preparing an ownership transfer operation, in compliance with applicable regulatory requirements. Throughout the transition process, GeoPost/DPDgroup will continue to fulfil its obligations to its customers, suppliers, and employees.”

It emphasised: “Upon completion the company (DPD Russia) will operate independently of GeoPost/DPDgroup which will have no more presence in Russia.”

Financial risk

GeoPost/DPDgroup also warned: “We anticipate a risk of impairment in the value of the company.” However, it noted DPD Russia already only had a book value of €128 million as of December 31, 2021 (at a conversion rate of €1 = RUB 85.3).

The French-based group made clear: “GeoPost/DPDgroup will not benefit (financially) from this transfer of ownership.”

Domestic operator

Established in 2004, GeoPost/DPDgroup’s Russian subsidiary (DPD Russia) operates mainly domestic delivery services to individuals and small business customers. The company, which employs about 3,000 people, had grown to turnover of about €200 million and claimed to be the third-biggest CEP player in the country.

However, it is believed to have suffered a big drop in volumes this year. In early March, DPD Russia said it was continuing to provide “full delivery services” in Russia and CIS states but confirmed it had been forced to adjust operations.

GeoPost/DPDgroup concluded: “In the face of this tragedy, we hope that peace will be restored in the nearest possible future.”