Fair trade regulator CCI has cleared British retailer Tesco’s purchase of a 50 percent stake in Tata Group firm Trent Hypermarket, the first FDI transaction in multi-brand retail since the sector was opened up in 2012, according to PTI.
Approving the purchase of stake in Trent Hypermarket Ltd (THL) by Tesco Overseas Investments Ltd, the CCI said Tesco was not earlier engaged in the retail business in India and the transaction “is not likely to have appreciable adverse effect on competition in India.”
According to the media report, CCI said: “As the FDI policy regarding multi-brand retailing has not been implemented in the states of Gujarat and Tamil Nadu, Trent Hypermarket has entered into a Stores Transfer Agreement on March 31, 2014, with Fiora Hypermarket Ltd (a wholly owned subsidiary of Trent), to transfer its four stores operating in Gujarat and Tamil Nadu. It is observed that while Trent Hypermarket is engaged in the business of multi-format retail trading in India, including hypermarkets, supermarkets and smaller convenience stores, TOIL (Tesco Overseas Investments Ltd) is not present in the retail market in India and, therefore, there is no horizontal overlap between the business activities of THL and TOIL in the retail market in India.”
