KUALA LUMPUR: Sime Darby Bhd’s wholly-owned units Sime Darby Allied Products Bhd and Sime Darby Holdings Bhd, have sold their 30 per cent stake in Tesco Stores (Malaysia) Sdn Bhd to CP Retail Development Company Ltd, Tesco Holdings BV and Tesco PLC for RM300 million.
Sime Darby, in a statement today, said the disposal was part of a larger deal between Tesco PLC and Thailand’s CP Group (CP) signed in March 2020, to sell Tesco PLC’s businesses in Thailand and Malaysia to CP for an enterprise value of US$10.6 billion.
Sime Darby expects an estimated net gain on disposal of RM270 million from the sale of its stake in Tesco Malaysia, a joint venture it held since 2001.
“We have come a long way with our joint-venture with Tesco. We opened our first store in Puchong in 2002. We have grown the business over the years and now have 69 stores nationwide.”
“This deal provides the group with an opportunity to exit the non-core hypermarket business at a reasonable valuation. This transaction is part of our ongoing efforts to rationalise our non-core assets,” said Sime Darby group chief executive officer Datuk Jeffri Salim Davidson.
The deal is conditional upon the approval of the Ministry of Domestic Trade and Consumer Affairs, the sale of Tesco BV’s shares in Tesco Malaysia and the sale of Tesco’s Thai business to CP.
Sime Darby expects the disposal to be completed in the second half of 2020.