Bharti hopeful of 50:50 JV with Wal-Mart for retail stores
Bharti Enterprises has started talks with Wal-Mart and is hoping to form a 50:50 joint venture to roll out retail outlets in India, a top company official has said.
New Delhi: Bharti Enterprises has started talks with Wal-Mart and is hoping to form a 50:50 joint venture to roll out retail outlets in India, a top company official has said.
The two companies have an equal partnership in wholesale business and the Indian partner is hopeful of replicating it in the retail business, following government's decision to allow up to 51 percent FDI in multi-brand retail.
Bharti Enterprises Vice Chairman and MD Rajan Bharti Mittal said "talks have started" and the company is hopeful that the nature of their relationship, under which Wal-Mart became an equal partner in wholesale business despite having a chance of bringing in 100 percent FDI, would continue.
"All I am trying to say here is that when there is opportunity to go 100 percent in wholesale, they had 50:50 with Bharti. Now, with the opening up of the front-end, the discussions are on the table and hopefully the relationship that we have enjoyed in the last five years will continue," Mittal said in CNN-IBN TV programme Devil's Advocate.
When asked if the retail JV will still be a 50:50 one, he said: "That's what I am trying to say. That's the relationship we have despite 100 percent being open (in wholesale)".
Mittal also dismissed various reports questioning the impact and work ethics of Wal-Mart terming them as "myth".
"That's not true to be honest. That's a myth of course. You really look at the US, where they do USD 300 billion business, they have about 11 percent of market share. They save about USD 230 billion worth to the consumers and two million jobs.
"So, that's a myth that they are going to squeeze from both sides," he said when asked about allegations on Wal-Mart paying less to farmers and hiking prices for consumers after capturing the market.