Tesco share price wobbles as grocer looks to bolster corporate finance department

on Jan 26, 2015
Updated: Oct 21, 2019

Tesco (LON:TSCO) had moved to beef up its in-house corporate finance capabilities, the Financial Times today reported. Britain’s largest supermarket chain has begun the search for a head of corporate development to join a small team, which will operate as a corporate finance department, focused on investment opportunities, portfolio reviews and disposals, as well as mergers and acquisitions activity. The team would report to Tesco’s new chief executive Dave Lewis, finance director Alan Stewart and group strategy director Benny Higgins

According to sources, cited by the FT, Lewis — who is striving to transform Tesco’s fortunes and rebuild transparency and trust in the retailer after a particularly torrid year for the grocer — has appointed headhunters, who have approached several senior bankers about the department’s top role. The insiders have not named any potential candidates for the position.
Tesco’s move to bolster its corporate finance department could herald a further shake up of its diverse portfolio and pave the way for more asset sales, the FT noted. The group is widely expected to cut back on peripheral activities to focus on its core supermarket business. Other options could include realising value from Tesco’s Asian assets, which could be worth between £8 billion and £9 billion, or selling a minority stake in Tesco Bank.

Tesco’s share price has been swinging between gains and losses so far this morning. After opening almost one percent higher, the stock tumbled and as of 09:40 GMT, it was changing hands at 234.25p – 0.45 percent down intraday.
According to the Financial Times, the 17 analysts projecting 12 month price targets for the FTSE 100-listed retailer, have a median target of 190.00p, with a high estimate of 325.00p and a low of 150.00p. As of 19 January 2015, the consensus forecast amongst 46 polled investment analysts covering Tesco has it that investors should hold their position in the company.
As of 10:09 GMT, Monday, 26 January, Tesco PLC share price is 234.40p.

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