India: Tesco bids to create multi brand outlets through Trent stake
Tesco has announced plans to run multi brand outlets in India by investing in local operator Trent Hypermarket.
Tesco is hoping to take a 50% stake in Trent Hypermarket Limited, which is a subsidiary of conglomerate Tata Group. Tesco’s plans have been submitted to India’s Foreign Investment Promotion Board.
The investment would see a step-up in cooperation between Tesco and Trent – a partnership that has already been running for five years in India under wholesale and franchise agreements. Tesco is a supplier of Star Bazaar, which is a chain run in India by Trent, and the two firms also announced plans to expand the Star Bazaar chain, which currently has stores in Maharashtra and Karnataka.
Noel Tata, vice chairman of Trent, stated: "The application is a positive step forward in the relationship between the Tata Group and Tesco. We believe that our understanding of the Indian market, coupled with Tesco's unparalleled global retail expertise will allow us to leverage the tremendous potential of the market to the benefit of all stakeholders."
Foreign companies have previously been prohibited from investing in multi brand retail outlets in India. However, last year saw a relaxation of this policy, and international investors are now permitted to own up 51% of such stores.
Source: Just Food