by Christopher Freeburn | October 9, 2013 10:48 am
Walmart (WMT) has decided to acquire Bharti Enterprises’ stake in their Indian wholesale store chain partnership.
The joint venture, which launched in 2007, currently operates 20 Best Price Modern Wholesale warehouse discount stores across India. Legal restrictions in India prevent foreign companies from opening supermarkets without an India-based partner with at least a 49% stake in the venture, Reuters notes.
Walmart had previously signaled plans to open eight new stores in India this year, but none have materialized so far. The retailer has faced a hostile legal environment toward foreign investment as well as allegations of bribery by employees at the joint venture, which led to the suspension of some workers last year after an internal probe.
The company has spent $157 million investigating allegations of bribery at its operations in Brazil, Mexico and India over the last year.
Changes to India’s supermarket ownership restrictions made last year have so far failed to draw other international companies into the country, though some are said to be waiting to see the outcome of upcoming elections, which could lead to another change in the law, before trying to enter the market.
In July, Walmart threatened to stop work on three new stores in Washington, D.C., if the city council approved a new law forcing Walmart to pay a higher minimum wage. The mayor ultimately vetoed the law.
Shares of Walmart rose slightly in Wednesday morning trading.
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