ParknShop said to have attracted bids from retailers including CRE, Aeon, Lotte, Woolworths and Wesfarmers

ParknShop said to have attracted bids from retailers including CRE, Aeon, Lotte, Woolworths and Wesfarmers

China Resources Enterprise has reportedly today (21 August) confirmed it has bid for Hong Kong supermarket chain ParknShop.

Over the weekend, the state-backed conglomerate, which already has stores in Hong Kong through its Vanguard chain, was said to be among a clutch of retailers and private-equity firms that had tabled an offer for the business.

Speaking after China Resources Enterprise announced its first-half results, CFO Frank Lai said the company had made a "fair and reasonable" bid for ParknShop, without specifying the value of the offer.

"ParknShop is a time-honoured and respected brand in Hong Kong," Lai said, according to Reuters. "Hong Kong is a market which is not small with population of over 7 million and consumption is high. ParknShop have a solid management and have demonstrated strong earnings capability even in an open and highly competitive market."

Lai also did not rule a joint bid for ParknShop with Tesco, Reuters added. Earlier this month, China Resources Enterprise and Tesco announced they had signed an MoU on plans to merge their businesses in China.

Hutchison Whampoa, the telecoms-to-energy conglomerate, announced last month it had started a review of ParknShop, one of Hong Kong's two largest food retailers, alongside Dairy Farm International Holdings. Reports at the weekend named retailers including China Resources Enterprise, fellow Chinese retailer Sun Art Retail Group and Japan's Aeon as bidders.

Reuters also said Australia's largest retailer Woolworths Ltd had tabled an offer. The Wall Street Journal named South Korea's Lotte Group as a bidder, while Hong Kong newspaper The Standard said Australian conglomerate Wesfarmers, the owner of Coles, Australia's number two grocer, as a bidder. Private-equity firms KKR, TPG and Blackstone have also been named as suitors.

China Resources Enterprise said today profits from its retail operations fell 63.7% in the first half of 2013. Its retail earnings were hit by an asset revaluation and the disposal of "non-core assets".

Excluding those items, China Resources Enterprise said its retail profits fell 4%. Revenue was up 13.7% with same-store sales 5.6% higher. The company said slower economic growth in China had affected consumer spending.

Click here for our Deal or no deal analysis on the potential sale of ParknShop, published on 6 August.