Tesco has ageed to sell its South Korean unit to a group led by private equity firm MBK Partners for US$6.1 billion.
Tesco is selling Homeplus, its biggest overseas unit to the MBK-led group, which includes Canada Pension Plan Investment Board (CPPIB), Public Sector Pension Investmen Board and Temasek Holdings.
CPPIB announced, in a separate statement, that it is taking a 21.5% stake in Homeplus for US$534 million.
Operating in South Korea since 1999, and with more than 1,000 retail outlets across the country, Homeplus is one of the largest multi-channel retailers in Korea and the number two player in both hypermarkets and supermarkets.
“We are pleased to invest alongside our longstanding partner, MBK Partners, in one of the leading retailers in South Korea,” said Pierre Lavallée, senior managing director & global head of investment partnerships, CPPIB. “Homeplus is an attractive investment for CPPIB as it provides us with access to one of the largest retail markets in Asia through a well-established business with a strong cash flow profile.”
CPPIB has been investing in South Korea since 2008 and it remains a key investment market for CPPIB in Asia.
