Tata Group has reportedly put its plan to acquire a majority stake in Vivo's India business on hold. The reason? Apple reportedly has objections to the deal.

According to reports, the Indian conglomerate was planning to buy a 51 percent stake in the Chinese smartphone manufacturer's Indian subsidiary. However, Apple is apparently uncomfortable with the deal, as it has partnered with Tata to manufacture its devices in India at the Bangalore facility.

A recent report by the Times of India, citing sources, reveals that Vivo, with a revenue of Rs 30,000 crore in FY23, was seeking to reduce its Chinese ownership as part of its strategy to comply with the Indian government's push for local ownership. The partnership is said to be particularly crucial for Vivo because the company has been facing scrutiny and regulatory challenges due to India's tightened regulations on investments from neighbouring countries. By selling a controlling stake to Tata Group, Vivo aims to secure a trusted local partner, gain easier access to local funding, and benefit under India's "Make in India" initiative.

Additionally, Vivo's tie-up with Tata would have provided a trusted local partner, which would have helped ease regulatory relations and facilitate easier access to Indian visas.

However, the proposed deal has now faced a setback because of Apple's concerns, particularly related to its operations in Bangalore. Tata's subsidiaries have been important in manufacturing Apple devices in India, a relationship that has positioned Tata as a significant player in the global electronics supply chain. This partnership with Apple has allowed Tata to produce iPhones for both the Indian market and global distribution, making India a significant manufacturing hub.

Tata's potential tie-up with Vivo posed a challenge for Apple, as it would mean Tata partnering with a competitor, which reportedly led to the breakdown of negotiations between Tata and Vivo.

"For Apple, any deal of the Tata group, its key manufacturing ally, with Vivo would have meant a partnership with a competitor. This perhaps led to the talks breaking down between Tata and Vivo… a re-think looks highly unlikely," a source told the publication. Meanwhile, Tata Group denied the development altogether, the report notes.