TJX to Sell Stake in Russian Retailer in Support of Ukraine

The TJX Cos. Inc. is cutting ties with Familia, an apparel and home fashion off-pricer with more than 400 stores in Russia.

“Given the recent Russian invasion on Ukraine, The TJX Companies Inc. has committed to divesting its equity ownership in Familia in support of the people of Ukraine,” the off-price giant said in a filing with the Securities and Exchange Commission Thursday.

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Doug Mizzi, a senior executive vice president at TJX, resigned from Familia’s board and Scott Goldenberg, another senior executive vice president as well as chief financial officer, will no longer serve as an observer.

TJX paid $225 million for a 25 percent stake in the business in 2019 and might have to record an impairment charge and, potentially, a loss on the investment.

As of Jan. 29, TJX pegged the value of Familia at $186 million, reflecting “the revaluing of the investment from Russian rubles to the U.S. dollar, resulting in a cumulative translation loss and reducing the carrying value of TJX’s investment by approximately $40 million,” the company noted.

And the value of the ruble has plummeted since much of the international financial community moved in sync to isolate Russia financially, rebuking the invasion by president Vladimir Putin. Where 78 rubles would buy $1 at the end of January, it now takes more than 110 rubles to make the trade — a massive swing in the currency market, which tends to adjust gradually.

The swiftness and aggressiveness of Putin’s push in neighboring Ukraine has put the world on notice and governments, companies and consumers are still all formulating their responses as the bloody conflict pushes into its second week.

Many companies, including Kering, Burberry and LVMH Moët Hennessy Louis Vuitton, are supporting relief organizations to help victims of the war and its refugees. H&M has paused all sales in Russia, as has Apple.

Few major Western fashion and retail companies have big ties to Russia, although the market was seen as a growth area not long ago.

When the Familia deal was first announced, Goldenberg told analysts: “We like Familia’s strong financial profile and management team. This investment allows us to gain exposure in a new region of the world with an established off-price retailer that has significant growth potential. We are also always looking for ways to increase value for TJX’s shareholders and see this as a good use of cash with an attractive return profile.”

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