Tesco has agreed to sell its Czech and Slovak businesses to Ahold Delhaize for £1.5bn, as Britain’s biggest supermarket sharpens its focus on its home market.
The company said the deal valued the two businesses, which generated combined sales of £2.9bn last year, at an enterprise value of €1.7bn, and would bring in net cash proceeds of around £1.0bn.
It expects to return most of that to shareholders through an additional share buyback once the deal completes, which is expected in the second half of 2027, subject to regulatory approval.
Tesco said the sale would simplify the group and let it focus more on its core UK and Irish food business. The deal excludes its remaining Central European business in Hungary, and the company said it continued to review its options there.
“For Tesco, the transaction will further simplify the Group, increasing our focus on our core UK and Irish businesses and supporting our continued investment in our food-first retail ecosystem and the capabilities that will drive future growth, while enabling a further return of capital to shareholders,” said Ken Murphy, Chief Executive of Tesco.
Tesco shares were 1% higher at the time of writing on Friday.