Tesco Sells Kipa and Giraffe Businesses

By Ian Walker

LONDON--Tesco PLC (TSCO.LN) Friday announced the sales of Turkish supermarket chain Kipa and the Giraffe U.K. restaurant chain as part of the grocer's move to focus more on the company's main U.K. market.

The U.K.'s number one grocer by market share is selling its 95.5% interest in Kipa to Turkish grocer Migros for around 30 million pounds ($43.4 million). The sale is expected to cut Tesco's debt by around GBP110 million, Tesco said.

Tesco is selling the Giraffe restaurant chain to Harry Ramsden fish and chip shop and brand owner Boparan Restaurants Holdings for an undisclosed sum.

Dave Lewis, who became Tesco's CEO in 2014, has moved to cut costs, shed non-core assets and simplify Tesco's range and store operations. A former Unilever PLC executive whose background is in building brands, Mr. Lewis recently unveiled a new range of lower-priced "Farm" brands in a bid to compete directly with discounters Lidl and Aldi.

Tesco has already sold 8.6% of its stake in Asian ecommerce platform Lazada Group SA to Alibaba Group Holding Ltd. for $129 million and announced it was shuttering its health business Nutricentre.

Tesco bought Giraffe in March 2013 for GBP48.6 million and Kipa in November 2003 for GBP75 million.

Shares closed Thursday at 157.9 pence. They are currently down 25% over the past 12 months.

-Saabira Chaudhuri contributed to this article.

Write to Ian Walker at [e-mail]; @IanWalk40289749

(END) Dow Jones Newswires

June 10, 2016 02:43 ET (06:43 GMT)

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