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Business News/ Companies / Carrefour CEO Olofsson to visit soon, may announce Future deal
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Carrefour CEO Olofsson to visit soon, may announce Future deal

Carrefour CEO Olofsson to visit soon, may announce Future deal


New Delhi: Lars Olofsson, the chief executive of Carrefour SA, is scheduled to visit India later this month or early February and he could announce the French retailer’s partnership with Kishore Biyani-led Future Group during the trip.

A person with direct knowledge of the situation said Olofsson is visiting New Delhi to make a formal announcement of its tie-up with Future Group that runs chains such as Big Bazaar, Pantaloons and Food Bazaar. Mint couldn’t independently confirm this, though news of an alliance between the two has been in the air for some time. A spokesperson for Carrefour declined to comment in response to emailed queries by Mint on Monday morning.

Biyani, who has not confirmed or denied the company’s talks with Carrefour, said he is “not aware" of Olofsson’s visit. Olofsson’s visit to India was confirmed by two other people close to the situation at Carrefour. None of the three wanted to be identified.

Mint had reported in May that Carrefour and Future Group had reached an agreement to open the foreign retailer’s branded stores in India.

The report said that Future would run the stores while the French retailer would manage the supply chain and technology for doing so, and also provide merchandise. It added that Future would pay an undisclosed royalty to the world’s second largest retailer after Wal-Mart Stores Inc.

On 30 December, the French retailer made its India entry with a wholesale store in New Delhi’s Seelampur neighbourhood that sells only to retailers and other businesses. Wholesale or cash-and-carry is the only area where India allows 100% investment by foreign companies, but such stores are only permitted to sell products to other businesses and not to the end consumers.

After waiting for years for India to open the sensitive multi-brand retail sector to foreign investment, several global retailers have, in recent years, entered the country through the permitted wholesale route in a bid to understand the country and to be ready to serve the large consumer market whenever India opens the sector. Wal-Mart has teamed up with New Delhi-based Bharti Enterprises Ltd in a 50:50 wholesale retailing joint venture and the alliance has so far rolled out five cash-and-carry stores. Britain’s Tesco Plc is also planning to roll out its wholesale stores in India later this year.

Over the years, Carrefour had held talks with Wal-Mart’s local partner Bharti Enterprises, the Wadia Group, and real estate developers DLF Ltd and MGF Ltd.

The first person with direct knowledge of Olofsson’s visit said Carrefour plans to open at least two more cash-and-carry stores in India this year and has already signed up properties in New Delhi’s suburb of Ghaziabad and another in the western city of Pune.

The person added that a team from Future Group including Biyani and Carrefour India officials were in Paris late last year to thrash out details of the deal.

The two companies have thus far not made an announcement on the possible agreement because they were waiting for the launch of Carrefour’s first cash-and-carry store, he added.

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Published: 10 Jan 2011, 11:19 PM IST
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