Tesco shares have slipped back despite reports it has invited at least six companies to bid for its South Korean business Homeplus, which could be worth around $6bn.
The potential buyers include KKR, CVC Partners and Carlyle Group, according to Reuters. Any sale would help Tesco cut debt and help fund its turnaround plan under chief executive Dave Lewis.
Tesco is currently down 0.7p at 202.8p, and while analysts at Killik & Co welcomed the report, they remain less than keen on the shares overall:
The [South Korean] business is substantial, with revenues of over $6bn, 400 owned stores and 500 franchised stores... If this report is correct, we would see it as a positive for the stock, as the Korean business has struggled in recent years in the face of opening hour restrictions, and would free up significant capital to be used in the UK business and to pay down debt.
But overall, our view on Tesco remains that it is likely to be dead money, with little chance of improved trading performance in the UK being evident in the short term.
