That competitive business called hypermarkets. Another one sold and leaving Asia.

I love to shop in Hero Market. Somehow it has the choices I need and the prices I could accept. AEON supermarket is also okay but not my favourite. I have not been to any Giant hypermarket for many months. When it comes to Tesco, I will always have a soft spot because I shopped there way earlier (when I was still studying in the UK) and years before it decided to open here in Malaysia. Well, latest news is that Tesco Malaysia and Thailand will be sold to Charoen Pokphand Group for an enterprise value of US$10.6 billion.

Article on the sale in here. According to Reuters, after the sale, Tesco will return US$6.6 billion (RM27.8 billion) to shareholders after the sale. This will be via a special dividend with an associated share consolidation. The deal is conditional upon the approval of its shareholdersand regulatory approvals in Thailand and Malaysia which is expected in the second half of 2020.

The sale is to the Thai group controlled by Dhanin Chearavanont. Once this sale goes through, Tesco’s overseas operations apart from Ireland would be its central European division, consisting of stores in the Czech Republic, Hungary, Poland and Slovakia. Tesco chief executive Dave Lewis said, “This sale releases material value and allows us to further simplify and focus the business, as well as to return significant value to shareholders.” Article on the sale in here.

Which supermarket / hypermarket is your favourite brand? Which comes first? Convenience? Choices? Prices? Or just the layout? By the way, for those who are unaware, the profit margins of supermarkets are low. Could be a low single digit yeah. Their only advantage is that it will sell a large quantity of all these items to many people everyday. On many occasions, some items may be offered as a loss leader (means every sale is a loss) but when people drop by to buy that item, they may also buy a few other items which will make up for the loss.

Do I think the brand would remain after the sale is concluded? I guess the brand could remain since everyone knows Tesco or it could even be a full rebranding for all its stores? The buyer is a seasoned supermarket operator in Thailand yeah. Happy shopping.

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One response to “That competitive business called hypermarkets. Another one sold and leaving Asia.”

  1. […] from current ones. Merger and Acquisitions happen all the time. This was the earlier article: Tesco is sold and leaving Asia. Fast forward to recently, this is what was written in Tesco Malaysia’s Facebook profile […]

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