Auchan has refused to be drawn on claims that the French retailer is in talks over a venture in India with Dubai-based company Landmark Group.
Reports in India and Dubai said negotiations were being held that could lead to Auchan, which has operations in Russia and China, entering the Indian market.
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Vipen Sethi, CEO of Landmark, which is Spar International’s partner in India, told the Arabian Business magazine that discussions were at a “preliminary” stage. He said a deal was unlikely to be finalised in 2012. “It won’t be this year. It is going to take time because India is a very complicated country,” Sethi said.
The Times of India newspaper had cited an anonymous source that claimed the talks were at an “advanced stage” with a decision “likely to take place in a month’s time”.
Sources told the newspaper that the nature of any agreement would depend on whether India does ease restrictions on foreign investment in the country’s retail sector. Government plans to allow overseas retailers to own a majority stake in multi-brand outlets in India were put on hold in December after opposition in some political and business circles. Landmark could run Auchan stores on a franchise business, one source told the paper.
However, Auchan declined to comment on whether it was in talks with Landmark, although it admitted it did monitor developments in India.
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By GlobalData“India is an important market and one of the countries that we observe with attention, just like many other retailers. In the context of the existing legislation situation, we watch the different franchise opportunities that may appear,” a spokesperson told just-food today (13 February).
