One of Hong Kong’s leading supermarket chains ParknShop has been put under review by its parent, the retail-to-energy conglomerate Hutchison Whampoa.
In a statement over the weekend, Hutchinson Whampoa said its subsidiary AS Watson & Co is conducting a “strategic review” of ParknShop in order to “optimise value for shareholders”.
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AS Watson said it did not have a definite timetable for completion of the review 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.
According to the Wall Street Journal, Hutchison is considering exiting the operations due to the “slow growth” of the business. The publication suggested owner and billionaire Li Ka-shing is looking to expand its other businesses.
Hutchison, however, stressed the group has “no intention” of withdrawing from Hong Kong, adding “market speculations are groundless”.
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By GlobalData“During the strategic review process, ASW and PNS will remain focused on executing their respective operational plans in the ordinary course of business,” the company said in its statement.
A source told Bloomberg the supermarket chain could fetch $3bn to $4bn in a sale.
