Tesco Extends JV in Korea

Tesco PLC
22 October 2004


Friday, October 22, 2004


          TESCO EXTENDS SAMSUNG JOINT VENTURE AGREEMENT IN SOUTH KOREA

Tesco and Samsung Corporation today announce an agreement to extend their
successful retail joint venture in Homeplus in South Korea until at least 2011.
The original five-year agreement was signed in 1999.

Commenting on the announcement, Andrew Higginson, Tesco Finance and Strategy
Director, said: 'We are delighted to be extending our successful joint venture
with Samsung Corporation. Together we have built-up a world-class business and
are very excited about the future growth opportunities in Korea.'

As part of the agreement, Tesco will buy a further 10% of Homeplus shares from
Samsung Corporation over the next seven years, taking its interest to 99 per
cent.

These share purchases will be in two stages, the first in July 2007 and the
second in July 2011. The total consideration depends on the performance of the
business in the years prior to the two transactions and will be based on
multiples of EBITDA.

The total consideration is estimated to be around £200 million and the parties
have agreed a price range of £40-60 million for the first 5% to be acquired in
2007.

Since the creation of the joint venture in May 1999, when Tesco purchased a
controlling 51% interest in Homeplus from Samsung, the business has grown
rapidly, managed by a strong local team, to become one of Korea's leading
retailers, with 30 hypermarkets. Tesco increased its interest in Homeplus to 81%
in June 1999 and to 89% in February 2002.


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