The Tata Group is in talks with US retailer Walmart and is likely to acquire up to 49% stake in its wholesale cash-and-carry business in India, multiple sources aware of the development said.
If the deal goes through, Bentonville-headquartered Walmart, which runs a B2B wholesale business in India under the ‘Best Price Modern Wholesale’ brand, will be able to leverage the Tata Group’s muscle and expand faster in the organized wholesale market. It is also likely to help the Tata group to accelerate its retail expansion plans.
Judith McKenna, president and CEO of Walmart International, who was in the Capital earlier this month, along with other Walmart executives, was scheduled to announce the deal but was unable to do so because the discussion between both the companies was not finalised, a top Walmart executive, who did not wish to be quoted, told TOI. The recent National Company Law Appellate Tribunal (NCLAT) order reinstating Cyrus Mistry as chairman of Tata Sons could further slow down the process given the prevailing uncertainty within the group, sources said.
“The partnership will bring in funds for Walmart India and it will enable the Tata Group to foray into the domestic cash-and-carry business,” said a person familiar with the development.
Walmart currently operates 28 Best Price stores across the country and owns a majority stake in Bengaluru-headquartered Flipkart Group, which runs online marketplaces Flipkart and Myntra. Reports, earlier this year, had indicated that the Tata group had held discussions with Walmart to stitch an alliance, including the possibility of a joint venture.
When asked about the plans with the Tata Group, a Walmart India spokesperson said, “We have no comments on this.” A questionnaire e-mailed to a Tata Group spokesperson did not elicit a response.
Other than Walmart, the domestic organised wholesale market is currently dominated by Metro AG, Reliance and new entrants, such as Thailand-based Lots Wholesale Solutions.
