Frustrated Wal-Mart lays consumer ambitions to rest with JV break-up

By RJ Whitehead,10-Oct-2013

Wal-Mart appears to have lost patience with its fraught ambition to enter Indian consumer retail, after deciding to buy out its local partner, Bharti Enterprises, from their six-year-old joint-venture.

The agreement is subject to finalization of definitive agreements and receipt of the necessary regulatory approvals.The two companies say they have reached an agreement to independently own and operate separate business formats in India and discontinue their franchise agreement in the retail business.

American giant staying in cash-and-carry

Once everything is in order, Wal-Mart will acquire Bharti’s stake in Bharti-Walmart, giving the world’s biggest retailer 100% ownership of all 20 stores in its Best Price Modern Wholesale cash and carry business.

Wal-mart said it plans to continue to grow this business while working with the government and interested stakeholders to create more preferable conditions for foreign direct investment in multi-brand retail.

Reading between the lines, the American giant has pretty much put its consumer retail plans on ice in the face of its high-profile political struggles as politicians have held sway on the thorny issue of foreign direct investment in multi-brand retail.

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Mrs Bector’s investor 'looking to divest stake in biscuits business'

02-Oct-2013

Rumours persist that one of India’s leading bakery and condiments companies is looking to sell off the controlling stake in its biscuits business to private equity investors.

Quoting “people in the know”, Business Standard reported that Motilal Oswal Private Equity is in talks with PE companies to sell its 23% share in the biscuits wing of Mrs Bector’s Foods, which contributes Rs450cr to Rs500cr (US$72m-80m) to the wider company’s Rs600cr (US$96m) annual revenue.

The sale can take place following a de-merger of the business’s operating units. Mrs Bector’s sells products under the brand name Cremica and supplies buns, liquid condiments, batter and breading to companies like McDonald’s, Hindustan Unilever, Big Bazaar, Air India and Domino’s.

MOPE retained its share in the biscuits business in 2010 when the Mrs Bector’s was split equally by founder Rajni Bector between his three sons.

The private equity company had earlier made its investment of Rs70cr (US$11.2m) in the North Indian company in 2010 by buying out the stake of Jade Garden, the Mauritius-based unit of US banking giant Goldman Sachs, which had invested in 2007, and is expected to make an exit of three times its investment.

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