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Tesco sells South Korean Homeplus business for £4.2bn

Tesco has agreed to sell its South Korean Homeplus business for £4.2bn to pay down its debt and strengthen its balance sheet.

The supermarket chain is selling Homeplus to a group of investors led by MBK Partners, a South Korean buyout firm, and including Canada Pension Plan.

The transaction is expected to close in the fourth quarter of this year.

“This sale realises material value for shareholders and allows us to make significant progress on our strategic priority of protecting and strengthening our balance sheet,” said chief executive Dave Lewis.

The sale is the first disposal since Tesco reported a pre-tax loss of £6.4bn for the year to February, compared with an annual pre-tax profit of £2.26bn a year earlier.

@Tara_Hounslea

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