PUMA: Hit by Fraud at Greek Joint Venture

Posted by in Economy

That’s a nice story reported by Reuters news agency! Sporting goods maker Puma suspects its Greek joint venture partner Glou of an economic  swindle! 
German sporting goods maker Puma  said it would bring criminal charges against its partners in a Greek joint venture after discovering a swindle that could cost it as much as 130 million euros ($181 million).

Puma said on Monday it suspected that its “Greek joint venture partner, along with members of the Greek local management, has committed a series of criminal acts” based on the preliminary findings of an audit.

“This is about systematic evasion and embezzlement,” Puma Chief Executive Jochen Zeitz told Reuters in an interview.

He said it was not yet clear how much Puma would seek in damages from its partners, brothers Georgious Glou and Antonius Glou, who own 15 percent each of the Puma Hellas venture.

Officials at Glou, a non-listed Greek clothing retailer, declined to comment. The two brothers did not immediately return a phone call to their office seeking comment.

Greece is one of Puma’s 10 biggest European markets, with annual sales in the tens of millions of euros.

“In the long term, Greece is an important market for us,” Zeitz said, but added that Puma would shrink its Greek business — under new management — to reflect tough economic conditions in the southeastern European country.

Greece’s economy has been pummeled as the debt-choked country tightens its belt to slash its sky-high budget deficit. The unemployment rate there has risen to 12 percent and is set to head to more than 14 percent next year.

Zeitz said that Puma, which is controlled by France’s PPR will exercise an option to take over the Glou brothers’ 30 percent of Puma Hellas and gain full control.

Full story Reuters here