Tesco share price: Grocer looks to buy O2 out of joint venture
Tesco (LON:TSCO) is seeking to buy out its joint venture partner O2, The Telegraph has revealed. The news comes with the UK’s biggest supermarket looking to expand sales outside the highly competitive groceries market.
Tesco’s share price has been steady this morning, having added 0.31 percent to 195.75p as of 09:02 GMT. The shares are slightly outperforming the broader London market, with the benchmark FTSE 100 index currently standing 0.10 percent higher at 6,131.52 points. In the year-to-date, the supermarket’s shares have soared 31 percent, as compared with a 1.65-percent fall in the Footsie.
The Telegraph reported today that Tesco was planning to take advantage of the fallout from Hutchison’s £10.25 billion takeover of O2 with a push in the UK mobile market. Industry sources told the newspaper that the UK’s biggest supermarket, which has a 50:50 joint venture with O2, was aiming to buy the portion of Tesco Mobile it does not already own, and secure a long-term deal with Hutchison for capacity on the merged networks. The FTSE 100 group reportedly signalled its intentions at a closed Brussels competition hearing about the planned takeover, with Hutchison said to be likely to welcome a sale of O2’s stake in Tesco Mobile.
“Tesco is an interested party in the merger review process,” a spokesman for the UK grocer told The Telegraph, adding that it was “important that any landscape created by the merger process allows challenger brands, such as Tesco Mobile, to deliver the best possible services for UK customers, and champions consumer choice”.
The move would mark a significant shift for the grocer which had previously explored a sale of the business in an effort to shore up its balance sheet.
As of 09:22 GMT, Wednesday, 09 March, Tesco PLC share price is 195.90p.
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