UK retailer Tesco (TESO.NYSE, TSCO.LON) is in talks to merge its China stores with state-run retail giant China Resources Enterprise (CRE), The Guardian reported. The joint venture would merge Tesco’s 131 stores in China with CRE’s 2,986 sites under the Vanguard brand. Tesco is expected to pay millions in fees for the deal, which will leave it with a 20% stake, and the Tesco brand is likely to disappear from China after the integration. This comes on the heels of its ill-fated US Fresh & Easy venture which cost US$2.8 billion, causing Tesco to refocus on the UK and rein in the company’s aggressive overseas expansion.
China Economic Review