US retail giant Walmart is to wholly own and operate its businesses in India.
This follows an end to its six-year old joint venture with Indian partner Bharti Enterprises. Walmart says it will acquire Bharti’s 50 per cent stake in the JV, which operates 20 wholesale stores in India under the Best Price Modern brand.
“Walmart will get 100 per cent ownership of the Best Price Modern wholesale cash-and-carry business; Bharti Retail will continue to operate Easyday retail stores across all formats,” said the company in a statement.
Walmart Asia president and CEO Scott Price says Walmart is committed to businesses that serve its members and provide good returns for its shareholders.
“We will continue to advocate for investment conditions that allow FDI multi-brand retail in India,” he said.
The Indian government has allowed foreign multi-brand retailers to own up to 51 per cent of their operations in the country, but no foreign retailers applied initially due to strict rules.
In August, the government eased the rules to attract foreign investments. The previous rule says that multi-brand retailers should source 30 per cent of their products from small and medium local companies. That has been loosened with retailers now given five years to comply with that clause, meaning they can source their products abroad during their initial operation.
One of the rule changes also allows foreign retailers to open stores in cities with less than 1 million population.