Reliance Retail and Bharti Enterprises are understood to be in talks to buy India assets of the world’s second largest retailer Carrefour that has decided to exit the country by closing its five stores, states PTI. According to industry sources, the availability of ready-made cash and carry stores and associated infrastructure is drawing interest of the two leading Indian firms.
When contacted, Reliance Retail and Bharti Enterprises spokespersons declined to comment. Similarly, Carrefour India regional director Frank Kenner declined to comment on talks regarding selling its India assets.
Yesterday, Carrefour in a statement announced its intention to close its five cash and carry stores in India. The company said “closure of Carrefour’s business in India will be effective at the end of September 2014.”
“Until that time, the company will continue to be fully engaged with all its employees, suppliers, partners and customers to ensure a smooth transition,” it said in a statement.
Carrefour is said to be exiting India operations to focus on its key markets in western Europe, China and Brazil.
The announcement from Carrefour comes almost two months after Narendra Modi led BJP got mandate to come to power at the Centre. BJP in its manifesto had said that it will keep FDI out of the key sector of multi-brand retail.
“Barring the multi-brand retail sector, FDI will be allowed in sectors wherever needed for job and asset creation, infrastructure and acquisition of niche technology and specialised expertise,” the BJP manifesto said.
Currently, Reliance Retail operates in the cash and carry segment under the brand name Reliance Market.
During the company’s AGM, Reliance Industries Chairman Mukesh Ambani while addressing the shareholders had praised Reliance Retail’s wholesale business and said: “Reliance Market has established leadership in wholesale segment in the country and enjoys patronage of more than 1.2 million kirana and small businesses. This format provides unmatched choice, value and convenience to them.”
As per industry sources, Bharti Enterprises has also been looking for a partner since it called off its six year 50:50 JV with US retail giant Walmart in October last year. Walmart bought Bharti’s stake in the JV.
Carrefour, which has been operating in India since 2010, has stores in Delhi, Jaipur, Agra, Meerut and Bangalore.
Carrefour Group is the second-largest retailer in the world, having 365,000 employees and more than 10,100 stores in 34 countries.
