Tesco PLC - Tesco Extends China Venture
12 December 2006
TESCO EXTENDS PARTNERSHIP IN CHINA
Tesco has today announced an agreement to extend its successful partnership with
Ting Hsin in China, increasing its share from 50% to 90%.
The deal, which is valued at around £180m (US$350m), will allow the partnership
to accelerate its growth in China whilst continuing to benefit from Ting Hsin's
invaluable local knowledge.
Tesco signed an agreement in September 2004 with Ting Hsin for a 50% stake in
its wholly owned subsidiary of Ting Cao, which owns the Hymall chain of 44
hypermarkets in China. The company has a focused strategy to grow in three key
areas - the north (including Beijing and Tianjin), the east (including Shanghai)
and south (including Guangzhou). The first store in the capital Beijing is due
to open early in the New Year.
Commenting on the announcement, Terry Leahy, Tesco Chief Executive, said: 'We
have seen exciting growth in China since announcing the joint venture two years
ago and are looking forward to the partnership entering a new phase. Ting Hsin
continues to be a large shareholder in the business. They are a valued supplier
of food products and we benefit from their unrivalled local knowledge as we grow
the Hymall business together.'
Ting Hsin Chairman, Wei Ying-Chiao, said: 'Ting Hsin has been pleased with the
joint venture and the business development of Hymall over the last two years.
As Ting Hsin focuses its efforts on its increasingly successful food business,
it is appropriate at this time to review the joint venture so as to facilitate
faster progress by ensuring greater Tesco involvement.''Ting Hsin is committed
to remaining a shareholder of Hymall and to provide
Tesco with guidance and local expertise as it currently gains experience in
Press: David Cox/Greg Sage +44 (0) 1992 644454/644887
Investor Relations: Steve Webb +44 (0) 1992 644800
This information is provided by RNS
The company news service from the London Stock Exchange