SINGAPORE (Reuters): British retailer Tesco has asked bidders to submit binding offers for its Asian business by Friday (Feb 28), in a deal that will see Thai billionaires fight for an asset valued at up to US$9 billion, sources with direct knowledge of the matter said.
The bidding is shaping up as a battle between Dhanin Chearavanont’s Charoen Pokphand (CP) Group, Central Group, controlled by the Chirathivat family, and beer-and-property magnate Charoen Sirivadhanabhakdi’s TCC Group, they said.
Tesco’s Asian operations comprise some 2,000 supermarket outlets and convenience stores in Thailand, where it is one of the biggest retail players, and 74 stores in Malaysia.
“This is a very competitive process pursued by serious bidders. Looking at the deal size and financing perspective, most large banks are involved, ” said one banking source who did not want be identified as the information is confidential.
Antitrust concerns could pose a challenge to some bidders as Thailand’s antitrust office said last month that the deal should not violate anti-monopoly laws.
Tesco will review the bids, and is set make a decision next month, the sources said.
The three Thai groups did not immediately respond to a Reuters query. There was also no response from Tesco, outside office hours.
Britain’s biggest retailer said in December it started a review of its Asian operations, made up mainly of the Thai and Malaysian operations, after receiving interest.
For Central Group, Tesco’s stores would bulk up its supermarkets and convenience business, while offering CP Group a chance to buy back the supermarket chain it sold to Tesco during the Asian 1997/98 financial crisis.
CP owns cash-and-carry Siam Makro, which operates some 130 stores and over 10,000 7-Eleven convenience stores under CP ALL.
Sirivadhanabhakdi’s TCC Group, through Berli Jucker, already owns the country’s second-largest hypermarket operator Big C Supercenter.
Tesco completed this week its exit from China with the 275 million pound sale of its joint venture stake to state-run partner China Resources Holdings. - Reuters
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