British retail company Tesco announced on Friday forming of an equal joint venture with Tata Group company Trent Ltd by picking up 50 per cent stake in Trent Hypermarket Ltd for about 85 million pounds.
“Following its previous announcement and receipt of approval from the Indian Foreign Investment Promotion Board, 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.
The stores are operated under the ‘Star Bazaar’ and ‘Star Daily’ banners, and spread across the Southern and Western regions of India, it added.
Last December, Trent and Tesco had announced they have sought regulatory approval to enter into a partnership where each would own a 50 per cent stake in THL, owned by the Tatas.Tesco became the first global retailer to apply for multi-brand retailing after the government allowed 51 per cent FDI in the segment in September, 2012. The Foreign Investment Promotion Board had cleared its proposal on December 30.