Blog: China Resources Enterprise interest in ParknShop could cool
Dean Best | 13 August 2013
With China Resources Enterprise working on plans to merge its retail business with Tesco's Chinese operations, the state-owned firm's reported interest in Hong Kong supermarket chain ParknShop could wane.
CRE was touted in reports as a potential bidder for ParknShop, which owner Hutchsion Whampoa, the Hong Kong telecoms, energy and retail conglomerate, has placed under "strategic review".
ParknShop has around 290 stores in Hong Kong - where it dominates the local retail sector alongside Dairy Farm International Holdings' Wellcome chain - and a further 50 outlets in mainland China.
CRE, which has almost 3,000 outlets in China, had been talked about as a likely bidder for ParknShop, for which the deadline for first-round bids is said to be the end of this week (although Hutchison Whampoa is refusing to say anything publicly beyond its announcement of the review).
However, there is talk CRE's merger talks with Tesco, announced on Friday, could mean the retailer will not throw its hat into the ring for ParknShop.
Japan's Aeon, private-equity giant KKR and Wal-Mart have been named as potential bidders for the retailer. A new owner would have a strong position in Hong Kong but it is a mature market. ParknShop's record in China has been mixed.
We should not have to wait long until the first-round of bidders are identified.
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