- Tesco to sell its Malaysian and Thai business following a bid from a buyer.
- The supermarket chain has refused to reveal the name of the buyer at this stage.
- Tesco operates 74 stores in Malaysia and another 1,967 in Thailand.
- The supermarket chain has performed fairly well in the stock market in 2019.
- Pulling out of Malaysia and Thailand, Tesco will only remain operational in Ireland and Central Europe outside of the UK.
British multinational groceries and general merchandise retailer, Tesco, had started a recovery plan following an accounting scandal in 2014. As part of the plan, the supermarket chain had started to pull out of the international markets. Extending on its recovery plan, Tesco announced in a statement on Sunday that it is considering selling the Malaysian and Thai segments of its business. Pulling out of these two markets, Central Europe and Ireland will remain the only two locations outside of the United Kingdom where the supermarket chain will be operational.
Tesco Operates 74 Stores In Malaysia And 1,967 In Thailand
While the company highlighted that it has started to thoroughly evaluate its businesses in Thailand and Malaysia, Tesco’s representative refused to divulge the name of the buyer at this stage. As per the announcement, Tesco currently operates 74 stores in Malaysia and another 1,967 stores in Thailand. According to an estimate, the stores in the two locations employ a total of around 60,000 people.
In the fiscal year ending in February, Tesco’s Malaysian and Thai businesses recorded 4.9 billion pounds in combined revenue with a profit of 286 million pounds in total. Following the 2014’s scandal, Tesco’s Chief Executive, Dave Lewis, had sold the South Korean Business to enhance support for the balance sheet. As per the report in 2015, Tesco had earned 4 billion pounds out of this sale.
CEO Dave Lewis Plans On Leaving The Supermarket Chain In The Upcoming Summer
Lewis had announced earlier this year that he intends to depart from the business in the upcoming summer. He had further added that Tesco’s asset sales can now be expected to have come to an end. As per the sources, however, the supermarket chain is again considering the bids to sell its Thai and Malaysian segments of its business.
Tesco declared in its recent statement:
“Tesco confirms that, following, inbound interest, it has commenced a review of the strategic options for its businesses in Thailand and Malaysia, including an evaluation of a possible sale of these businesses. The evaluation of strategic options is at an early stage, no decisions concerning the future of Tesco Thailand or Malaysia have been taken and there can be no assurance that any transaction will be concluded”.
With a market cap of 22.75 billion, Tesco has performed well in the stock market in 2019. Having started the year at 191 GBX, the supermarket chain printed a year-to-date high of 253 GBX in April. The stock is currently exchanging hands at around 232 GBX. Share prices have remained above the opening level in 2019 so far.