Tesco CEO Terry Leahy has ruled out making a significant acquisition in the US and is instead focusing the company's efforts on China, he told the Observer newspaper.

Speaking as leader of the UK's biggest retailer at present, Leahy said to the Observer: "People have talked about businesses in the US that could be bought, but I don't think they are right for us. We have had researchers in America, but I can tell you that we have no current plans to make an acquisition there. 

"We will have to scale up in China, it's such a big place that you either have to ease out or commit quite a bit."

Leahy also told the newspaper that integration into China could take many years to achieve.

In July 2004, just-food reported Tesco's first steps onto the country's supermarket floor, with its 50% acquisition of the Chinese Hymall chain. It now has 50 Chinese hypermarkets together with Hymall.