Marks & Spencer [M&S] has dumped its existing franchisee in India Planet Retail to join hands with Mukesh Ambani’s Reliance Retail for further expansion.
Under this deal, a new company with an initial investment of Rs 230 crore is floated under the brand name Marks & Spencer Reliance India Pvt Ltd. M&S will own 51% in the venture. It will have the right to operate M&S stores in India selling items such as women’s men’s and kids’ clothing as well as home wares. It plans to open 50 new stores over the next 5 years.
Mr. Mukesh Ambani, Chariman RIL said,
We are excited to partner with M&S to combine Reliance’s understanding of the Indian market place and its traditional strengths in areas such as technology, infrastructure, logistics and training with M&S’s legendary retailing and product development capabilities to deliver a delightful experience for Indian consumer.
Mr. Stuart Rose said,
Reliance Retail is the ideal partner for us to accelerate our expansion and create the opportunity to open much bigger M&S stores.
Does this mean that M&S was unhappy with its current franchisee, Planet Retail ? Well, M&S experienced slower than expected growth in India and that maybe one of the reasons to shake hands with RIL where, Growth is Life 🙂