The Board of Tesco PLC announces that it has entered into an agreement with Sime Darby Berhad to form a joint venture company to develop hypermarkets in Malaysia.

The agreement and development plans are conditional upon approvals being obtained from the relevant Malaysian Government Authorities.

Subject to regulatory approvals, it is proposed that Tesco will own 70% and Sime Darby 30% of the joint venture company, Tesco Stores (Malaysia) Sdn Bhd (TSM).

It is currently planned for TSM to invest approximately RM1.2bn (£215m) to open around 15 hypermarkets. The timing of the investment and store openings will depend on market conditions and the performance of the business.

This agreement represents the next step in the Tesco strategy of opening large stores in developing retail markets. Tesco already operates 32 hypermarkets in Thailand, South Korea and Taiwan as well as over 100 stores in Central Europe and more than 700 stores in the UK and Republic of Ireland.

As has been seen in other countries in which Tesco has expanded, these plans will increase opportunities for Malaysian food and other products.

Tesco looks forward to working closely with Sime Darby, who are one of the most respected companies in Malaysia. They are a blue chip multi-national conglomerate with interests in many industries including property development, plantations, general trading and services.

(£1 = RM5.6)


Harjeet Drubra – Tesco Investor Relations Tel:-01992 646 663 Mob:-07720 288960

David Sawday – Tesco Press Office Tel:-01992 644 739 Mob:-07801 236499

Angus Maitland – Maitland Consultancy Tel:-0207 379 5151