Wal-Mart to go solo in India, calls off JV with Bharti
Wal-Mart has called off its joint venture with India's Bharti Enterprises in a deal which will see it go solo in Asia's third-largest economy.
Under the agreement, announced on Wednesday, Wal-Mart will acquire Bharti's 50 percent stake in their joint venture. It will give the U.S.' largest retailer full ownership of the Best Price Modern Wholesale cash and carry business, which runs 20 stores.
Bharti, which is also the parent company of Bharti Airtel, India's biggest mobile phone carrier, will operate its Easy Day chain of convenience stores alone.
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The move comes three days after a Wal-Mart Asia executive told Reuters the tie-up with Bharti was "not tenable" as a base for its business in India.
It will come as a blow to India's government, which last year sought to attract global supermarket chains to the country by allowing them to own up to 51 percent of local retailers.
In a joint statement issued on Wednesday, Scott Price, president and CEO of Wal-Mart Asia, said the move would be beneficial to both parties.
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"Through Wal-Mart's investment in India, including our cash and carry business, supply chain infrastructure, direct farm program and supplier development, we want to serve India and its people," he said.
"Wal-Mart is committed to businesses that serve our members and provide good returns for our shareholders, and we will continue to advocate for investment conditions that allow FDI multi-brand retail in India."
While the vice chairman and managing director of Bharti Enterprises, Rajan Bharti Mittal, said the company would continue to invest in its retail division. "We believe that with our current footprint of 212 stores, we have a strong platform to significantly grow the business and delight customers," Mittal said.
—By CNBC's Katrina Bishop. Follow her on Twitter