Britain’s Tesco plans on exiting from Asian markets
LONDON-Britain’s biggest retailer, Tesco (TSCO.L) has signaled serious withdrawal from its large global objective by initiating assessment on remaining Asian businesses which could bring Thai and Malaysian operations up for sale.
In line with the firm’s 100th anniversary, Tesco is also five years deep in UK-focused action plan initiated by Chief Executive Dave Lewis designed to recuperate from atrocious trading setback due to an accounting scandal.
Last October, Lewis released a statement about Tesco’s accomplished turnaround as he declared his resignation from the position.
“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,” it said in a statement on Sunday.
The firm stated that the assessment was at the initial stage and opted out from releasing crucial details about the approaches.
“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,” it added.
Within six months ending last Aug. 24, the firm acquired 2.6 billion pounds worth of sales as it traded from 1,967 outlets in Thailand and 74 in Malaysia. This recorded a 1% exchange rate and an operating profit of 171 million pounds, equivalent to 42.3%.
Tesco previously said that Asia could promote business growth specifically in Thailand as it cited an opportunity for 750 new convenience store outlets over the medium term.
4 billion pounds were spent for acquisition of wholesaler Booker last 2018 as Lewis focused more on investing UK.
In 2015, Tesco had its South Korean outlet sold to private equity company MBK Partners for $6.1 billion. The following year, it sold its leg to Migros, Turkey’s biggest supermarket chain.
There have been records of market exits from Japan, the United States, and China made by the former management.
Should there be an exit made from Thailand and Malaysia, Tesco would be left with Ireland operations and stores in Czech Republic, Hungary, Poland, and Slovakia.
After Lewis’s resignation, Ken Murphy is expected to take the office with executive background at healthcare group Walgreens Boots Alliance (WBA. O). However, turnover date is not confirmed yet.
Tesco shares rounded at 232.2 pence on Friday making the business 22.8 billion pounds in value.