Tesco Considering Sale of Asian Businesses

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Tesco Considering Sale of Asian Businesses

Post by Alpha8472 » December 9th, 2019, 12:38 am

The UK supermarket chain Tesco is considering the sale of its Asian businesses following an offer from a third party investor. Tesco has lost money on many of its foreign chains. They may just want to sell Thailand or Malaysia and cut their losses or potential losses. The Thai business is quite a crown jewel. Any offer would be in the mid to high billions of pounds.

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Re: Tesco Considering Sale of Asian Businesses

Post by buckguy » December 9th, 2019, 11:31 am

It's seems odd they would sell a profitable business to save their lagging operations in Central/Eastern Europe. their original partner was CP (Chester's Chicken, and 7-11 in Thailand), but i could see the Central Group (previous partner of Ahold) being interested, although they already have a competitor to Tesco's hypermarts.

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Re: Tesco Considering Sale of Asian Businesses

Post by veteran+ » December 9th, 2019, 4:16 pm

I predicted that Tesco would bleed for years after the Fresh & Easy disaster.

Hubris is a corporation KILLER and Tesco (I know first hand) is a prime example.

I think they will eventually contract to Europe and even perhaps dilute Eastern Europe.

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Re: Tesco Considering Sale of Asian Businesses

Post by retailfanmitchell019 » December 9th, 2019, 5:48 pm

Not to mention they opened F&F (Tesco owned) apparel stores inside Hy-Vee a few years ago. https://www.desmoinesregister.com/story ... /86194976/

Those were replaced with Joe Fresh (Loblaws owned clothing brand)

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Re: Tesco Considering Sale of Asian Businesses

Post by storewanderer » December 14th, 2019, 8:29 pm

buckguy wrote:
December 9th, 2019, 11:31 am
It's seems odd they would sell a profitable business to save their lagging operations in Central/Eastern Europe. their original partner was CP (Chester's Chicken, and 7-11 in Thailand), but i could see the Central Group (previous partner of Ahold) being interested, although they already have a competitor to Tesco's hypermarts.
Your comment "it seems odd they would..."

You must not have gotten to watch the Fresh & Easy soap opera very closely...

Some things never change.

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Re: Tesco Considering Sale of Asian Businesses

Post by cathandler » December 29th, 2019, 1:15 pm

Hubris is one thing (and there was a fair amount of it with respect to Tesco's history in the US) but the thing is that Tesco had run out of growth opportunities in its home territory so in order to continue to grow they had to look to new territories. It's the same impulse that led J. Sainsbury to buy into (and eventually assume full ownership of) Shaw's. As with Sainsbury's giving up its international ambitions, Tesco is responding to ever-increasing competitive pressures in its home market.

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Re: Tesco Considering Sale of Asian Businesses

Post by storewanderer » December 29th, 2019, 7:49 pm

cathandler wrote:
December 29th, 2019, 1:15 pm
Hubris is one thing (and there was a fair amount of it with respect to Tesco's history in the US) but the thing is that Tesco had run out of growth opportunities in its home territory so in order to continue to grow they had to look to new territories. It's the same impulse that led J. Sainsbury to buy into (and eventually assume full ownership of) Shaw's. As with Sainsbury's giving up its international ambitions, Tesco is responding to ever-increasing competitive pressures in its home market.
Tesco had its eye off the ball in its home market and internationally they definitely had some wins but their performance and conduct in the US showed the true colors of their company. Now they are even selling off profitable international operations. They were, are, and will continue to be a screwed up company with its best days behind it.

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Re: Tesco Considering Sale of Asian Businesses

Post by veteran+ » December 30th, 2019, 10:04 am

cathandler wrote:
December 29th, 2019, 1:15 pm
Hubris is one thing (and there was a fair amount of it with respect to Tesco's history in the US) but the thing is that Tesco had run out of growth opportunities in its home territory so in order to continue to grow they had to look to new territories. It's the same impulse that led J. Sainsbury to buy into (and eventually assume full ownership of) Shaw's. As with Sainsbury's giving up its international ambitions, Tesco is responding to ever-increasing competitive pressures in its home market.
Agreed except for "a fair amount"...............it was more than a profuse amount. I had never witnessed such an amount of destructive hubris in a corporation.

Fresh & Easy FINALLY exposed the decades long rot from deep inside the behemoth. It was quite an experience observing mostly very bright and experienced British management making awful decisions and behaving in such arrogant fashion.

One of the most repeated comments were: If it works in England then it has to and WILL work everywhere else in the world.

Over 3.5 billion dollars in losses (only regarding Fresh & Easy) that were avoidable and predicted (if they continued in their course of actions). Most of us experienced Americans persistently tried to explain to NO avail.

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Re: Tesco Considering Sale of Asian Businesses

Post by retailfanmitchell019 » June 4th, 2020, 10:24 pm

This news is kinda late, but in March, Tesco agreed to sell its Asian businesses (in Thailand and Malaysia) to a Thai billionaire. They are even considering selling off their Polish operations.
https://www.bloomberg.com/news/articles ... l-dividend
I am not surprised. Tesco has struggled in general in recent years because of ego descisons, like these international expansions which have mostly failed, because they don't really understand how food shopping is different outside of Europe. Their best days are definitely far behind them.
In the past 10 years, Tesco has exited Japan (2011), United States (2013, we all know how Fresh & Easy failed), South Korea (2014), China (2015), and now Thailand/Malaysia.
Not to mention that Tesco also had an agreement with Hy-Vee in 2016 to sell their F&F clothing. Hy-Vee replaced F&F with Joe Fresh (owned by Loblaws) last year. Save-On-Foods (Western Canadian chain) had an agreement with them to sell Tesco brands in their stores in 2017 (similar to Jewel/Lucky selling President's Choice in the 90's). That agreement ended last year.

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Re: Tesco Considering Sale of Asian Businesses

Post by pseudo3d » June 5th, 2020, 12:22 am

cathandler wrote:
December 29th, 2019, 1:15 pm
Hubris is one thing (and there was a fair amount of it with respect to Tesco's history in the US) but the thing is that Tesco had run out of growth opportunities in its home territory so in order to continue to grow they had to look to new territories. It's the same impulse that led J. Sainsbury to buy into (and eventually assume full ownership of) Shaw's. As with Sainsbury's giving up its international ambitions, Tesco is responding to ever-increasing competitive pressures in its home market.
From what I could tell, Sainsbury's did a decent job controlling Shaw's, keeping the chain for about 15 years or so and expanding it through new growth and Star Market. The merger with Star Market did probably muck up the works (I believe Shaw's was the low price leader originally and Star Market was the more upmarket one...or do I have that reversed?) and of course, SuperValu didn't help matters much. Still, Shaw's/Star Market survived and was able to be sold for $2.5B, something that Fresh & Easy wasn't able to do (it sure wasn't a billion-dollar sale).

One wonders why Tesco didn't just buy an existing supermarket and not try to reinvent the wheel...

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