Interestingly, Reliance Retail and RP-Sanjiv Goenka’s Spencer’s Retail have sent legal notices to Bharti Retail in the past over incorrect price comparison campaign that Bharti ran.
“Bharti Group definitely feels the need to have a partner who is well established in this field. Bharti was getting core competency and technical know-how from Wal-Mart. Retail is one of the toughest businesses to be in currently and although the Bharti Group is well funded, they may look for expertise,” says Abneesh Roy, associate director, Institutional Equities Research, Edelweiss Securities .
“Now what needs to be seen is what happens to the prior commitments that Bharti had made especially the ones related to land leasing,” Rajagopalan adds.
Both the companies began their partnership in 2007, after which Bharti set up easyday stores under Bharti Retail. It was anticipated that once the government allows foreign companies to invest in front-end, Wal-Mart would pick up equity stake in the venture.