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Cosmetic chain Arbat Prestige to close outlets in St. Petersburg

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ST. PETERSBURG, April 16 (RIA Novosti) - Russia's Arbat Prestige cosmetics chain, whose owner was arrested in late January for tax evasion, announced Wednesday it was closing several outlets in St. Petersburg as part of a streamlining operation.

"We had planned to close several outlets back in December to streamline the chain's business, and this is why several outlets in St. Petersburg are being closed now," company advertising director Anton Melnikov said.

Vladimir Nekrasov, Arbat Prestige's owner, was arrested along with his associate Sergei Shnaider, also known as Semyon Mogilevich, who is wanted by the FBI. Nekrasov is facing a claim for 49 million rubles ($2.1 million) in back taxes for 2006.

A RIA Novosti correspondent said that a large outlet in central St. Petersburg had closed on Wednesday morning.

"We are not speaking about global closures. We have recently opened a new outlet in Moscow, and are planning to open up in a number of Russian regions," Melnikov said.

Kommersant, a respected Russian daily, wrote in February that the retailer's largest suppliers had cancelled deliveries and predicted that its outlets could close within the next few weeks.

Arbat Prestige has 64 outlets in Moscow, the Moscow Region, St. Petersburg, Kazan and Voronezh. According to the retailer, its business was worth $346 million in 2006. Staraya Krepost, a leading consultant on the Russian cosmetics market, has calculated that Arbat Prestige accounts for 14.7% of the market estimated at $2.34 billion in 2006.

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