Tesco to look at Netto stores being sold by Asda

Tesco Plc, the U.K.’s largest retailer, will look at the Netto discount stores that Wal-Mart Stores Inc.’s Asda chain has offered to sell in order to resolve local competition issues.

“We will always look at stores available in the market,” said Richard Brasher, who takes over as head of Tesco’s domestic unit in March. The Cheshunt, England-based retailer will add 1.9 million square feet of selling space in the second half, Brasher said in an interview at the IGD convention in London.

Asda last month offered to sell 47 Netto outlets, from a total 194 that it plans to acquire, to alleviate the concerns of regulators that competition could be “substantially reduced” in one in four of the areas where both chains have stores. Leeds, England-based Asda said discussions with prospective buyers had begun.

Tesco’s share of the U.K. grocery market was 30.9 percent in the 12 weeks ended Oct. 3, Kantar Worldpanel said today, unchanged from a year earlier. Separate data from Nielsen showed the retailer’s share falling to 27.7 percent from 28.2 percent.

“We’re opening new space and we’re serving more customers so in that regard I’m happy,” Brasher said. “But in terms of can we do better, of course we can.”

Source : Sarah Shannon - Bloomberg