Tesco Sells Czech and Slovak Businesses for €1.7B

Tesco has agreed to sell its retail businesses in the Czech Republic and Slovakia to Ahold Delhaize at a total enterprise value of €1.7 billion (£1.5 billion).

The transaction covers all stores and offices in both countries, as well as distribution centres in Kralupy, Presov and Beckov. Completion is expected in the second half of 2027, subject to antitrust and other regulatory approvals.

Tesco Agrees to €1.7 Billion Sale

The sale is structured on a cash and debt-free basis and is expected to generate net cash proceeds of €1.2 billion (£1.0 billion) for Tesco before tax and other transaction costs.

The Czech and Slovak businesses generated combined sales of £2.9 billion.

They also accounted for the majority of the £115 million adjusted operating profit reported by Tesco’s Central European region in the previous 52-week period.

Tesco Chief Executive Ken Murphy said the transaction would further simplify the group and increase its focus on its core UK and Irish businesses.

He also said it would support continued investment in Tesco’s food-first retail ecosystem and capabilities for future growth.

Retail Property Assets Included in the Transaction

The agreement includes the businesses’ physical retail and operational footprint in the Czech Republic and Slovakia. This encompasses stores, offices and distribution centres located in Kralupy, Presov and Beckov.

From a real estate perspective, the transaction involves a portfolio of retail and logistics-related properties connected to Tesco’s operations in the two countries.

The article does not provide individual property valuations, asset counts, floor areas or details of the future ownership and operation of the locations after completion.

The transaction is expected to close in the second half of 2027, subject to regulatory clearances. Until completion, the sale remains an agreed transaction rather than a completed transfer of the businesses and their property footprint.

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Tesco’s Central European Portfolio and Hungary

Tesco’s Hungarian operations are not included in the agreement and will remain under the company’s ownership. Tesco said it would continue to review options for its Hungarian business.

The company has also been disposing of non-core property assets in Central Europe.

Since 2021, and before this transaction, Tesco had raised approximately £0.5 billion through the sale of non-core properties, including a number of large shopping malls.

The Czech and Slovak sale forms part of Tesco’s wider effort to simplify its business structure.

Goldman Sachs and Citi are acting as joint financial advisers to Tesco, while A&O Shearman is serving as its legal adviser.

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Key Takeaways

• Tesco agreed to sell its Czech and Slovak retail businesses to Ahold Delhaize for an enterprise value of €1.7 billion.
• The deal includes all stores and offices in both countries and distribution centres in Kralupy, Presov and Beckov.
• Completion is expected in the second half of 2027, subject to antitrust and other regulatory approvals.
• Tesco’s Hungarian operations are excluded and remain under its ownership.
• Tesco has raised approximately £0.5 billion since 2021 through sales of non-core Central European property assets, including shopping malls.

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