Walmart (NYSE: WMT), which ended a 6-year-old joint venture with Bharti Enterprises last year, spent $334 million to sever ties with the Indian company.
Walmart had earlier paid $100 million to take over its Indian partner’s 50 percent stake in Bharti Walmart Pvt Ltd., which runs 20 wholesale stores under the Best Price Modern Wholesale brand.
In October 2013, Walmart called off its six-year-old partnership with Bharti Enterprises and decided to operate wholesale stores independently in India. The transaction resulted in a net loss of about $151 million, according to the company’s annual report.
Walmart has been trying to rebuild its India operations since ending its partnership with Bharti Enterprises. Walmart said that the Indian government’s regulations requiring foreign retailers to buy 30 percent of products from local small and midsize businesses were the “critical stumbling block” to opening Walmart stores there.
In April, the company said it was making progress, with the announcement that it will open 50 cash-and-carry stores in India over the next five years. Walmart also said it will launch a B2B e-commerce platform for members of Best Price Modern Wholesale Stores.
Walmart has 20 wholesale stores in 15 cities in India under the Best Price Modern Wholesale nameplate. These stores are not open to consumers, but restricted to other retailers. The website will be an exclusive virtual store for its members with a similar assortment of products, as well as special items. Best Price Modern Wholesale has roughly one million registered members.
-See this Reuters article
By Jarrett Neil Ridlinghafer
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