Aeon Co., Japan’s largest retailer, agreed to buy 50 percent of Tesco PLC’s operations in the country for a “nominal sum,” almost a year after the U.K. retailer said it was looking for a buyer.
Aeon will probably buy the stake in autumn, Koji Tsusue, a spokesman for the Tokyo-based company, told reporters Monday, without disclosing specific terms. Tesco agreed to invest £40 million ($63 million) in a joint venture to finance restructuring the Japanese unit, according to Tesco’s statement to the London Stock Exchange.
The acquisition adds to two regional grocers Aeon bought last year amid a recovery in demand following the March 11, 2011, disasters. Tesco, the largest U.K. grocer, last year announced plans to sell the Japan business, saying it was the smallest of its international retail businesses.
“Tesco Japan’s stores in metropolitan areas are the part that looked most attractive,” Tsusue told reporters in Tokyo. “Aeon sees metropolitan areas as a pillar of growth.”
The sale to Aeon, when completed, will leave Tesco with no further financial exposure to the Japanese business, the Cheshunt, U.K.-based company said in Monday’s Regulatory News Service statement.
“Having made considerable efforts in Japan, we have concluded that we cannot build a sufficiently scalable business,” Chief Executive Officer Philip Clarke said in a Regulatory News Service statement in August.