Local giants eye Tesco assets

The Thailand and Malaysian operations of Britain’s largest supermarket chain Tesco Plc are on the shopping lists of two of the country’s biggest conglomerates.

The Charoen Pokphand Group and Central Group are among the companies that are weighing bids for the Southeast Asian business that could fetch more than US$7 billion, according to people with knowledge of the matter.

CP Group and Central Group are holding discussions with financial advisers preparing for separate bids, said the sources, who asked not to be identified as the information is private. TCC Group, controlled by billionaire Charoen Sirivadhanabhakdi, has also expressed interest, they said.

Tesco said in December that it was carrying out a strategic review of its Thai and Malaysian businesses after receiving interest.

A sale of the Asian operations would allow the chain to get an infusion of cash to continue a restructuring of its core UK business that has cut thousands of jobs.

Tesco is expected to call for initial bids for the businesses as soon as next month, the sources said. Companies might decide against making any offer as deliberations continue, they added.

Tesco has more than 2,000 hypermarkets and convenience stores in Thailand under the Tesco Lotus brand.

The chain was founded by CP Group in 1994 and later taken over by the British firm.

In Malaysia, Tesco has over 70 shops, according to its annual report. The Malaysian conglomerate Sime Darby owns a 30% stake in Tesco Malaysia.

CP All Plc operates some 11,000 7-Eleven convenience stores and other businesses across the country, while Central is the country’s largest retailer with department stores, shopping malls, supermarkets and other assets.

Ref: Property Report