Response toGovernmentDecision

Tesco PLC
26 September 2003


26 September 2003

                TESCO RESPONSE TO GOVERNMENT DECISION ON SAFEWAY

Tesco today responded to the Government's decision not to allow the three
biggest supermarkets to bid for Safeway by pledging to continue to deliver for
its customers.

Chief Executive, Sir Terry Leahy, said: 'Although we are disappointed that we
are not able to offer Safeway shoppers the same fantastic experience we try to
give our 12 million customers in our stores every week, we are not entirely
surprised by the Government's decision. It is in line with the statements
released by the Competition Commission as part of its inquiry, which suggested
that a tough view would be taken on consolidation.

'However, as the UK's leading supermarket we thrive on competition. Our recent
results, our moves to bring new competition to the telecoms sector and our
latest round of price cuts show that we continue to provide the best value for
customers. We have a strong strategy for growth in food, non-food, retail
services and overseas which we look forward to continuing.'

The great job that Tesco do for customers was last night recognised when Tesco
was declared best Multiple Retailer of the Year and Fresh Produce Retailer of
the Year.

                                    - Ends -

          This document is available on the internet at www.tesco.com

Contacts:

Press:          Lucy Neville-Rolfe              Tel: [phone]
                Angus Maitland                  Tel: [phone]

Analysts:       Steven N Butler                 Tel: [phone]
                Lucy Cross                      Tel: [phone]


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