French luxury goods group LVMH has kept control of St. Petersburg’s Grand Hotel Europe despite selling its Dior and Bulgari stores in Russia

The French luxury goods conglomerate LVMH has kept control of St. Petersburg’s Grand Hotel Europe after the start of Russia’s full-scale invasion of Ukraine, despite statements that it was fully closing down its business in the country. The hotel continues to host and serve corporate clients who are under European sanctions, including employees of the Russian defense corporation Rostec, state-owned banks VTB and Sberbank, and state-owned oil major Rosneft, according to a recent Reuters report.

All public signs of the hotel’s ties to the French company were indeed removed. For example, a plaque with the Belmond logo (a unit of LVMH) disappeared from the facade, and in 2023 the hotel was removed from the company’s official website. However, corporate documents that have been made public in Russia, the UK, and France show that Belmond continues to control the Grand Hotel Europe. For example, the hotel’s operator, Europe Hotel LLC, is listed among several hundred LVMH subsidiaries on page 401 of the company’s annual report filed with French regulators.

Tax documents reviewed by Reuters also mention the hotel’s corporate clients. From the second quarter of 2022 through the first quarter of 2025, the hotel received money from entities linked to Rostec, Sovcomflot, Rosneft, Sberbank, Sovcombank, VTB, and President-Service (the official tour operator of the presidential affairs administration). President-Service paid the hotel a total of around $270,000, and the sanctioned entity Sovcombank paid about $140,000. Reuters noted that the payment dates coincided with an annual forum held in St. Petersburg in 2023 and 2024. (The Insider notes that this appears to refer to the St. Petersburg International Economic Forum, for which the hotel is an official partner.)

According to Russian financial documents, the hotel’s annual revenue nearly doubled from 2022 to 2024, reaching 1.9 billion rubles ($25 million). In 2024, the hotel posted net profit of about $5.7 million, the highest figure since such data were first published in 2004. The hotel’s profits, Reuters reported, remain in Russia.

LVMH executives considered closing the St. Petersburg property but ultimately decided against the idea, two sources with knowledge of the matter told Reuters. The news agency quoted one of them as saying: “These are people who work for us, that we have been paying for years. Shall we punish them because their country is being run by a fool?”

At the start of Russia’s full-scale invasion of Ukraine, LVMH closed its Louis Vuitton, Dior, and Bulgari boutiques in Russia. It also sold its Sephora cosmetics stores at a loss, even though the products offered by those stores were not under sanctions. The company also donated at least 5 million euros to people affected by the war in Ukraine.