UK retailer Tesco sells Thailand, Malaysia ops for US$10b

Britain’s biggest retailer, Tesco, yesterday announced it will sell its businesses in Thailand and Malaysia to Thai conglomerate CP Group for 8.0 billion pounds (US$10.4 billion).

“Following inbound interest and a detailed strategic review of all options, we are announcing today the proposed sale of Tesco Thailand and Tesco Malaysia,” said outgoing Chief Executive Dave Lewis in a statement, adding the supermarket chain would return 5.0 billion pounds of proceeds to investors.

“This sale releases material value and allows us to further simplify and focus the business, as well as return significant value to shareholders.”

The divestment will also slash Tesco’s debt and streamline the company, enabling a stronger focus on operations in the UK, Ireland and central Europe.

“The disposal will further de-risk the Tesco business by reducing debt through a 2.5-billion-pound pension contribution that, along with other measures, is expected to eliminate the current funding deficit and significantly reduce the prospect of having to make further pension deficit contributions in the future,” Lewis said.