Three business houses are likely to be in the final race to strike a deal with Germany's Metro AG for investing in its India unit -- Metro Cash & Carry. Industry sources in the know named Reliance, Adani Group, and Thailand's conglomerate Charoen Pokphand (CP) as potential frontrunners to acquire a partial or full stake in the Gurugram-headquartered Metro Cash & Carry, which has 31 stores and 5,000 direct employees. Around 20 companies, including strategic and private equity investors, were approached by the German chain, inviting them to bid for the Indian wholesale business, according to a source aware of the M&A developments.
Reliance Industries Ltd will acquire German firm Metro AG's wholesale operations in India for Rs 2,850 crore as the conglomerate run by billionaire Mukesh Ambani seeks to strengthen its dominant position in India's mammoth retail sector. "Reliance Retail Ventures Limited (RRVL), a subsidiary of Reliance Industries Ltd, signed definitive agreements to acquire a 100 per cent equity stake in Metro Cash & Carry India for a total cash consideration of Rs 2,850 crore, subject to closing adjustments," said a joint statement. Through this acquisition, Reliance Retail will get access to a network of Metro India stores located in prime locations across key cities, along with a large base of registered kiranas and other institutional customers, and a strong supplier network.
The Competition Commission of India (CCI) on Tuesday said it has approved Reliance Retail Venture's acquisition of German firm Metro AG's wholesale operations in India. Reliance Retail Ventures Ltd (RRVL) is a subsidiary of Reliance Industries Ltd (RIL) while Metro Cash & Carry India is engaged in the wholesale operations in India. In December last year, it was announced that RRVL had signed definitive agreements to acquire a 100 per cent equity stake in the company for a total cash consideration of Rs 2,850 crore.
Though a decade of Big Bazaar and Spencers hasn't affected small shopkeepers, most are wary of FDI in retail distorting the market.
German wholesale retailer, Metro Cash & Carry, is planning to open four new stores in India by the end of 2012, of which two would come up at Zirakpur in Punjab and Indore in Madhya Pradesh.
Germany's Metro Cash & Carry on Thursday said it will open 8-10 stores in the country annually in the next four years, with an investment of around Rs 2,400 crore (Rs 24 billion) on the stores.
Buddha countermands Forward Bloc's rejection of German wholesaler's permit.
Left Front constituent Forward Bloc, which runs West Bengal's agriculture marketing board, and CPI-M leaders, on Sunday decided to renew Metro Cash & Carry's Agricultural Produce Marketing Committee licence on October 10. However, to protect small traders in the city, the State Agriculture Marketing Board will impose certain conditions on Metro, the modalities of which will be decided in the intervening period.
Reliance Industries (RIL) has been distilling its investment strategy to meet new goals. The share of the new energy vertical - its key focus area - accounts for more than a fourth (26 per cent) of the total war chest of $6.4 billion, ploughed into acquisitions and picking up stake from 2018 to date, reveals the latest Morgan Stanley data. Nearly half the incremental investments made on deals by RIL between August 2020 and September this year ($3.3 billion) has been spent on new energy - acquiring global companies with technology and expertise.
FMCG distributors on Thursday said it has suspended their boycott of certain products of oral care maker Colgate after talks with the company representatives over the issue of the price disparity between the traditional distributors and organised business-to-business channel. A day after a virtual meeting with Colgate-Palmolive (India) Ltd (CPIL) representatives, the All India Consumer Products Distributors Federation (AICPDF) called off its stir to boycott certain products of the company starting from January 1, 2022. "From today, the movement against Colgate is postponed till further notice," the AICPDF said in a statement.
'90 per cent of the food and grocery business is still with the kiranas.' 'If kiranas are not allowed to operate, it becomes a serious issue.'
James Scott, Metro Cash & Carry's regional operating officer (Asia) based in Singapore, virtually lives out of a suitcase. With the regional headquarters in Hong Kong and operations across China, India, Pakistan, and Vietnam, Scott travels through the week and gets back home only on weekends.
The fresh allegations of carrying out retail trade have come from the Forward Bloc, a constituent of the Left Front government in Bengal, which had been opposing the entry of Metro on this ground. Forward Bloc-controlled APMC in the state has submitted a report stating the instances of violations of the terms of the Regulated Market Committee licence, said sources.
The company is facing resistance on renewal of its Agriculture Produce Market Committee license to buy farm produce directly from farmers for its Kolkata store. The ruling Left Front partner Forward Bloc is opposing its bid to renew the license as it is of the opinion that this would affect small traders.
Metro Cash & Carry, the global German wholesale major, will invest about Euro 40-45 million for setting up two new marts in Kolkata and Mumbai, expected to become operational by the first quarter next year. It is also planning to enter Punjab.
German retail giant Metro Cash & Carry and India's emerging retail venture Reliance Retail have roped in the property services group of ICICI Bank for identifying retail properties for its proposed pan India expansion.
"The entry of other players in this segment will help in reiterating the benefits of the cash-and-carry concept to Indian customers," Metro India Managing Director Martin Dlouhy says. It may be the first time anywhere in the world that Wal-Mart and Metro square off in the cash & carry format. Dlouhy's apparent nonchalance can't hide the fact that Metro may be facing one of its most difficult challenges in the country.
The company feels that it has the first mover advantage and is now gearing up to face the competition by consolidating its presence through rapid expansion.
Metro Cash & Carry India plans to recruit about 325 people within a week to kick start its operations and commence pre-construction work at the southern end of the Eastern Metropolitan Bypass in Kolkata.
The demands from retailers are fourfold: One, allow kiranas, general trade stores, supermarkets, hypermarkets, and wholesalers to operate every day of the week till 9 pm. Two, ensure uniform and regular opening of all categories of retail. Three, hassle-free movement of goods and employees, and four, lift bans on malls in states like Maharashtra.
This recognition is a testimony of India's strong belief in promoting entrepreneurship
Some sectors like aviation, hospitality, travel and tourism, and automobile have witnessed zero cash flow since the lockdown began.
PhonePe via Bharat Bill Payment System (BBPS) plans to get into a number of new verticals, including fee payments in schools and colleges, payments at hospitals and other services
'The best way to make an impact in this market is by focusing on three things: Unmet customer need, unarticulated customer need, and emerging customer need,' Metro's Arvind Mediratta tells Sangeeta Tanwar and Alokananda Chakraborty.
With an epic battle of billionaires for supremacy in one of the world's most prolific markets and a pandemic-propelled surge in online shopping in the background, India's nearly trillion-dollar retail market is hoping to touch 85 per cent of the pre-COVID business in the first half of the New Year. In a year when the COVID-19 carnage ripped apart the retail business, circa 2020 will best go down for the unravelling of the war between Jeff Bezos, the world's wealthiest man, and richest Indian Mukesh Ambani for pre-eminence in the booming market that is estimated to reach $1.3 trillion by 2025. It all started with Ambani's Reliance Industries agreeing in August to buy assets of the nation's second-largest retailer for Rs 24,713 crore, just a year after Bezos' Amazon purchased an indirect stake in the indebted Future Retail.
Four new retailers from US, two from Germany may have shown interest in setting up shop in India.
Retailers present in India are in talks with Carrefour to buy its assets piecemeal, rather than the whole business.
Mumbai-based LocalBanya is looking to expand to Pune and Delhi as part of its growth strategy.
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