NARVA - Conflicting reports surfaced this week about plans by Krenholm, a textile producer, to switch a large part of its operations to Ivangorod, a Russian town across the river.
The business daily Aripaev reported that Krenholm, which has laid off hundreds of workers in recent years, would begin subcontracting services this spring and that eventually a large part of the company's sewing operations would be concentrated there.
"This is indeed true 's we're transferring a small part of sewing to Russia," Thomas Widstrand, manager of Boras Wafveri, Krenholmi's Swedish parent company, told the paper. He said that Krenholm did not intend to set up a new company in Russia or dismiss seamstresses in Narva because of this.
"This may lead to the dismissal of seamstresses in the future, but for now we have no such plans," Widstrand said.
Later, however, the company denied the report. Nadezhda Sinyakova, head of the company's sewing division in Narva, told the local Narvskaya Gazeta paper that Aripaev had misrepresented what Widstrand had said. "Apparently Aripaev has again misunderstood Widstrand," she said.
Krenholm, she said, did not have any plans to move to Russia.
Sinyakova said that management was merely trying to find out if the situation in Russia was favorable enough for outsourcing. "We've visited Ivangorod and have come to the conclusion that today it is imprudent to place contracts in Ivangorod because there is no sufficient number of specialists there. They are available in Kingisepp [further east of Ivangorod 's ed.], but it is not profitable to deliver them to Ivangorod from there," she explained.
She added that the Kingisepp sewing factory was essentially able to take contracts from Krenholm.
Still, according to what Widstrand told Aripaev, a part of Krenholm's sewing operations would probably be shifted to Russia, though not all. In his words, initially some 20-50 people would get work in a Russian-owned company across the river.
2004 was reportedly the worst year in Krenholm's history, with revenues falling and workers laid off, Aripaev wrote. The company's debt burden topped half a billion kroons (32 million euros).
Widstrand remained bullish. "Today I'm considerably more positive about Krenholm's staying in business than a year or six months ago," he said.
Kreenholmi Valdus and its subsidiaries have belonged to Boras Wafveri for the past 10 years. The firm at present employs 3,800 people, compared with more than 4,400 at the beginning of 2004.
