Tesco, the UK's largest retailer, plans to acquire a 50 per cent stake in the Tata-owned Hypermarkets for $110 million (nearly Rs 650 crore), and if completed, it would be the first foreign chain to invest in supermarkets here, given the liberalised FDI norms.
The proposed partnership will operate and build on the existing portfolio of Star Bazaar stores in Maharashtra and Karnataka only, as the other two states in which this Tata-owned retailer is present have banned foreign investment.
"We have got Tesco's application. We will go through the proposal and hope to send it to the Foreign Investment Promotion Board by next week. They have not sought any clarification about the foreign investment policy from us," said a senior official of the Department of Industrial Promotion and Policy (DIPP).
The Tata-Tesco joint venture will not use the Tesco brand for its stores in India.