CHINA: China Resources Enterprise silent over ParknShop "interest"

By Michelle Russell | 26 July 2013

ParknShop claims to be the market leading food retailer in Hong Kong

ParknShop claims to be the market leading food retailer in Hong Kong

China Resources Enterprise has remained tight-lipped over reports it is among retailers looking to place a bid for one of Hong Kong's leading supermarket chains ParknShop.

The retail chain was this month put under review by its parent, the retail-to-energy conglomerate Hutchison Whampoa. The firm said it was conducting a "strategic review" of ParknShop in order to "optimise value for shareholders".

Since then, China Resources Enterprise, the retail, food and beverage arm of China Resources Holdings, has become one of a number of companies reported to be considering a bid for the chain. Others include Japan's Aeon, Australian retailer Woolworths Ltd and China's Sun Art Retail.

The auction is also said to be generating interest from private-equity firms, Reuters noted.

China Resources Enterprise, however, told just-food it had "no comment on market rumour". Aeon could not be reached for comment. Woolworths and Sun Art did not return a request for comment at the time of going to press.

On revealing news of the review earlier this week, Hutchison Whampoa said it did not have a definite timetable for completion and therefore there could be "no assurances" the process will result in any transaction being announced or completed.

ParknShop claims to be the market leading food retailer in Hong Kong with a "significant" market position in Macau and south China. It operates 345 stores and had revenues of HK$21.7bn (US$2.80bn) in 2012.

A source told Bloomberg this week the supermarket chain could fetch $3bn to $4bn in a sale.

Sectors: Emerging markets, Mergers & acquisitions, Retail

Companies: Aeon, Woolworths Ltd

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