Tesco PLC's shares jumped 4.6% on Dec. 9 after the U.K. supermarket operator said it had begun a strategic review of its businesses in Thailand and Malaysia, including the option of a possible sale.
The grocery retailer said the move followed "inbound interest," although it did not identify the entity that made the approach.
"The evaluation of strategic options is at an early stage, 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," the company said in a statement to the London Stock Exchange. A further announcement would be made if and when appropriate, it added.
Details were reported by the Financial Times on Dec. 8.
Tesco's Asian operations are concentrated in Thailand and Malaysia, where it operates 2,038 stores and employs about 60,000 staff, according to its annual report for the fiscal year ended Feb. 23, 2019. The businesses in Thailand and in Malaysia in the fiscal year generated operating profit of £286 million out of the group total of £2.15 billion, according to the report.
The strategic review comes despite an announcement in June that Tesco plans to open 750 convenience stores in Thailand, where it also operates hypermarkets.
In addition, it comes at a time of transition for Tesco, which also has operations in the Czech Republic, Slovakia, Hungary and Poland. The company announced in October the planned departure of CEO Dave Lewis, who has led Tesco since 2014. Lewis will be succeeded in the summer of 2020 by Ken Murphy, chief commercial officer at Walgreens Boots Alliance Inc.
In early trading in London, Tesco's shares were up 10.70 pence at 243 pence.