Tesco Plc has come a step closer to become the first foreign retail chain to set up a supermarket in India with the British retail giant formally announcing a joint venture in equal partnership with the Tata Group’s Trent Hypermarket Limited about £85 million (about `867 crore).
“Following its previous announcement and receipt of approval from the Indian Foreign Investment Promotion Board (FIPB), Tesco has today entered into an agreement with Trent Ltd, a part of the Tata Group, to form a 50:50 Joint Venture in Trent Hypermarket Ltd (THL),” the company said in a statement.
THL operates the Star Bazaar retail business in India.
“On completion of the transaction THL will operate 12 stores retailing a range of merchandise, including food and grocery, personal and home-care products, home and kitchen, fashion and accessories etc,” Tesco said.
In December, the FIPB had approved its proposal for partnership with THL.
The venture plans to set up the first of these stores in Maharashtra and neighbouring Karnataka.
Tesco has a franchise agreement to provide support to Trent’s Star Bazaar that currently operates 16 stores across the southern and western regions of India.