Tesco to invest heavily in Malaysian operation

After the announcement that it acquired the eight cash & carry stores of Makro from Dutch-based SHV Holding, Tesco Malaysia announced to invest approximately US$563mn in its store network over the next three to five years. Chris Bush, chief executive of Tesco Malaysia, said this at a news conference where he explained the Makro acquisition.

The Makro stores will be refurbished and renamed Tesco Extra. The existing staff number of 900 will be enlarged by hiring another 1,500 staff members. Also, Tesco will invest in its supply chain by setting up a new fresh food distribution centre. In 2007 three new hypermarkets will be built, in Johor Bahru, Alor Setar and Kota Baru. According to Bush, Tesco invested about MYR911mn (US$247mn at 2006 exchange rates) since 2001. The – still undisclosed – acquisition price of the eight Makro stores is not included in this figure.