Tesco is selling its polish business unit in Poland amid market challenges as it looks to hone its focus in Central Europe.
The sale to Salling Group A/S includes the sale of 301 stores together with the associated distribution centres and head office.
“We have seen significant progress in our business in Central Europe, but continue to see market challenges in Poland,” Tesco Chief Executive Dave Lewis.
“Today’s announcement allows us to focus in the region on our business in the Czech Republic, Hungary and Slovakia, where we have stronger market positions with good growth prospects and achieve margins, cashflows and returns which are accretive to the Group.”
He added: “We see this transaction as the best way to secure the future of the business for our colleagues and customers in Poland.”
Total enterprise value agreed for the transaction is PLN 900m (equivalent to £181m), with total net proceeds expected to be approximately PLN 819m (equivalent to £165m).
Tesco said that proceeds from the sale will be used for general corporate purposes.
The deal is subject to is subject to antitrust approval.