Business news from Ukraine

SUBSIDIARY OF DEUTSCHE LUFTHANSA GROUP BRUSSELS AIRLINES TO START FLYING TO KYIV

Brussels Airlines, the subsidiary of Deutsche Lufthansa Group, will start flying to Kyiv from October 17, 2018, Lufthansa General Manager for Ukraine, Armenia, Belarus, Georgia, Azerbaijan and Turkmenistan Rene Koinzack said at a press conference in Kyiv on Wednesday. “The first flights will be on October 17. Brussels and the capital of Ukraine will be connected, which is very important for us,” he said.
Koinzack said that Brussels Airlines also fly to Africa, which creates additional opportunities for Ukrainians.
Lufthansa Group in the field of passenger air transportation, along with the same name brand, includes Austrian Airlines, Swiss Airlines, Eurowings (including Germanwings) and Brussels Airlines, as well as a share in Turkey’s SunExpress. In addition, the group includes logistics, technical and service companies.

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CHINESE MYWAY AIRLINES TO LAUNCH FLIGHTS TO KYIV FROM TBILISI ON OCT 5

The new Georgian Myway Airlines from October 5, 2018 will launch regular flights to Kyiv (the Boryspil international airport) from Tbilisi, the airline wrote on its Facebook page on September 12. The regular Tbilisi-Kyiv-Tbilisi flights will be serviced twice a week – on Mondays and Fridays. From October 24, Myway will add one more flight on Wednesdays.
Myway Airlines was founded in 2018. It is a project of China’s Hualing Group.
Its fleet consists of two Boeing 737-80 aircraft.

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IKEA PLANS TO EXPAND NETWORK AFTER OPENING FIRST STORE IN KYIV

Sweden’s IKEA, the largest furniture and household goods retailer in the world, plans to expand its network in Kyiv and other cities of Ukraine after testing the first store in Kyiv-based Ocean Mall, which will be opened in summer 2019. “We want to study and understand the market with the first store, and then, when we feel that we understand the market, we will open other stores in Kyiv and other cities. One year is ideal for studying to get a full cycle… Also we are working to ensure the introduction of online sales as fast as possible,” IKEA Southeast Europe CEO Stefan Vanoverbeke said in an interview with Interfax-Ukraine.
According to him, the area of the first IKEA store in Kyiv will be about 6,000 square meters, the range of goods will include furniture and accessories.
“The store will be divided into locations. We call them room sets. It is a kind of room where we show solutions for home. In addition, there will be a concept for small household solutions. There will be all the components. We will collect the maximum number of products to provide the full and best experience for buyers,” Vanoverbeke said.
According to him, the range of items in the Ukrainian store will include products that the company sells in other countries. The company intends to develop retail outlets that will be smaller in size than traditional ones for IKEA.
“The idea to build one big shopping center in one part of the city is no longer working. For example, residents of the left bank area of Kyiv, to get to the store on the right bank, have to spend one or two hours. It is not so convenient. First, this will be downtown, and later, perhaps, we will add a food outlet, and further, probably, we will develop the concept of smaller outlets in less accessible places in the residential areas,” he said.
At the same time, Vanoverbeke said that the company does not rule out the expansion in retail space in Ukraine.
“Our colleagues have analyzed the market of large shopping centers and, indeed, in Ukraine, in comparison with the countries of Western Europe, there is an opportunity to increase the space of IKEA. Our achievements with large shopping centers are more typical for countries like China. But we are still analyzing it for Ukraine. Let’s see how the market will develop,” he said.

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SWEDEN IKEA TO OPEN FIRST STORE IN KYIV

Sweden’s IKEA, the largest furniture and household goods retailer in the world, has officially announced the opening of a first store in Ukraine in the city store format in the shopping and entertainment center Ocean Mall in 2019. “The company will open its first store of the new city format in Kyiv in 2019. It will be one of the first IKEA city stores in the world… along with France, the U.K., Denmark, the United States and China. The store in Kyiv will be located in the shopping and entertainment center Ocean Mall,” the press service of the company said.
According to the announcement, the new format of the stores is smaller in size and located in the central part of the city to satisfy the demands of modern consumers who want to make purchases closer to home, as well as online.
“Taking into account the results of the market and consumer preferences study, our team has chosen the most favorable business model, which will enable IKEA to implement plans in Kyiv in the near future. In the new store of the city format, our buyers will get acquainted with the new IKEA approach to creating a comfortable life for as more people as possible,” IKEA Southeast Europe CEO Stefan Vanoverbeke said.
As reported, the report of the Swedish retailer for 2017 says that the company is testing a new city store format, one with a smaller area and closer to the city.
As was announced earlier, IKEA plans to open stores with an area of up to 5,000 square meters in Warsaw’s Blue City shopping and entertainment mall (Poland) and in the center of Paris (France). They will stock a smaller assortment of goods, with emphasis shifted to online commerce services.
In December 2017, IKEA announced plans to open the first facility in Kyiv within two years.
According to the press service, the development of the network in Ukraine will be under the aegis of IKEA Southeast Europe, which is part of the IKEA Group (Ingka Holding B.V.). The company is engaged in retail business IKEA in Croatia, Serbia, Romania and Slovenia. Swedish IKEA is one of the world’s largest retail chains for furniture and household goods. The owners of the IKEA Group are Ingka Holding B.V. and structures under its control.

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KYIV ANNOUNCES REPEATED TENDER TO BUILD ANOTHER SUBWAY LINE

Municipal enterprise Kyiv Metropoliten, which ordered the contraction of the subway line running to the Vynohradar residential area in Kyiv, has announced the repeated tender. According to the information in the ProZorro e-procurement system, the expected cost of works is UAH 5.994 billion. Bids can be submitted before October 11 inclusively. The bids will be opened on November 16. The bid security is UAH 1 million (at the previous tender it was UAH 29.9 million). The minimum decrement is 0.5% (UAH 29.9 million).
In addition, during the new tender the only criterion for selecting the winner is the price, while at the previous tender the term of work delivery was taken into account by 25%.
As reported, on September 5, 2018, Kyiv Metropoliten cancelled a tender for constructing a new subway line to the Vynohradar residential area. One of the bidders, PJSC Kyivmetrobud failed to provide a bank guarantee in time for participating in the auction. Kyiv Metropoliten rejected the offer of another participant, LLC Adamant Construction Company (Adamant), citing the company’s failure to provide reliable tender documents. Adamant filed a complaint with the Antimonopoly Committee of Ukraine leading to the cancellation of the auction.
Kyiv Metropoliten in January 2018 announced a tender to build the Syretsko-Pecherska subway line from the Syrets station to the Vynohradar residential in Kyiv’s Podilsky District to the tune of UAH 6.3 billion. The date of the tender was repeatedly postponed. The expected cost of work at the last auction fell to UAH 5.99 billion.
Kyiv City State Administration approved the subway line construction blueprints in July 2018.
The new section of the subway line will consist of two stations – Mostytska and Prospekt Pravdy, as well as a section in the direction to the Vynohradar station. It is estimated that construction work will take 36 months.

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URBAN SPACE 500 RESTAURANT TO BE OPENED IN KYIV IN DEC

The public restaurant Urban Space 500, being launched under the social franchise contract of the Urban Space 100 Project in Ivano-Frankivsk, will be opened in Kyiv in December and will be located at 9, Hrynchenko Street, the founder of the Teple Misto platform, businessman, restaurant-keeper (the 23 restaurants chain) Yuriy Fyliuk has said in an interview with Interfax-Ukraine.
“Urban Space 500 is a social franchise that Teple Misto handed over to the NGO Insha Osvita. This organization began to collect social investors, selected the management company – Druzi Cafe & Bar is fully engaged in the implementation of this project. Today, they have all 500 donators. Reconstruction of the premises is under way. They are scheduled to open [the restaurant] on December 1,” Fyliuk said.
He said that the restaurant model provides for a certain number of donators (one hundred in Ivano-Frankivsk and five hundred in Kyiv), which make a one-time non-refundable contribution of $1,000. Donators become participants in a public organization, which in turn is the founder of a limited liability company that carries out operational activities.
Some 80% of the net profit of the restaurant is returned to the public organization, and its general meeting decides which city development projects to support using these funds. The remaining 20% goes to the management company.
“We received more than 250 requests from 15 countries for the replication of this experience. Today, the first franchise went to Kyiv. According to the plan, the two next cities are Kramatorsk and Poltava. There are requests from Berlin, San Francisco, other capitals of European countries, from Malaysia. It is very interesting [to realize it in] Berlin and Francisco. I think it will happen someday, but we are moving step by step. This is not easy project for it to take place. There must be a lot of factors coming together,” Fyliuk said.

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