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Bharti Walmart to raise Rs 500 cr from banks
Bharti Walmart, a joint venture (JV) between Sunil Bharti Mittal’s Bharti Enterprises and the world’s largest retailer, Walmart, plans to raise Rs 500 crore from global banking majors such as Citigroup, JP Morgan Chase, Deutsche Bank and BNP Paribas, to fund its expansion plans, according to sources in the know.
It had earlier said it planned to set up 10 to 12 wholesale cash and carry centres in 2012, which would generate employment for 5,000 people. According to estimates, each such centre requires an investment of Rs 50-60 crore. At present, Bharti Walmart has 17 stores across the country.
A company spokesperson confirmed talks were on. “The money is being raised for investing in building of an efficient back-end infrastructure and for our Best Price Modern Wholesale Cash and Carry store roll-out programme,” he said.
India allows 100 per cent foreign ownership in wholesale operations and single brand retail. Germany’s Metro, French company Carrefour and UK’s Booker are the major players in the Indian cash and carry market, besides Bharti Walmart.
“It shows the market is maturing and banks are gaining confidence in the sector. Some level of equity investments have happened in the JV and it thought it is time to leverage. It also could be that the domestic partner may not want to put equity and a $100-million debt is not a big deal for Walmart,” said Harminder Sahni, founder and managing director of Wazir Advisors, a business consultancy.
In December, the government put on hold plans to open the multi-brand retail sector to foreign chains due to political opposition.
However, finance minister Pranab Mukherjee said in his 2012-13 Budget speech that talks were on with several states in an effort to reach a consensus on the issue.
Bharti Walmart to raise Rs 500 cr from banks
Bharti Walmart, a joint venture (JV) between Sunil Bharti Mittal’s Bharti Enterprises and the world’s largest retailer, Walmart, plans to raise Rs 500 crore from global banking majors such as Citigroup, JP Morgan Chase, Deutsche Bank and BNP Paribas, to fund its expansion plans, according to sources in the know.
It had earlier said it planned to set up 10 to 12 wholesale cash and carry centres in 2012, which would generate employment for 5,000 people. According to estimates, each such centre requires an investment of Rs 50-60 crore. At present, Bharti Walmart has 17 stores across the country.
A company spokesperson confirmed talks were on. “The money is being raised for investing in building of an efficient back-end infrastructure and for our Best Price Modern Wholesale Cash and Carry store roll-out programme,” he said.
India allows 100 per cent foreign ownership in wholesale operations and single brand retail. Germany’s Metro, French company Carrefour and UK’s Booker are the major players in the Indian cash and carry market, besides Bharti Walmart.
“It shows the market is maturing and banks are gaining confidence in the sector. Some level of equity investments have happened in the JV and it thought it is time to leverage. It also could be that the domestic partner may not want to put equity and a $100-million debt is not a big deal for Walmart,” said Harminder Sahni, founder and managing director of Wazir Advisors, a business consultancy.
In December, the government put on hold plans to open the multi-brand retail sector to foreign chains due to political opposition.
However, finance minister Pranab Mukherjee said in his 2012-13 Budget speech that talks were on with several states in an effort to reach a consensus on the issue.