New Property Joint Venture

Tesco PLC
04 January 2007


                    TESCO ANNOUNCES NEW PROPERTY JOINT VENTURE


Tesco today announced a new property joint venture to realise £445m from its UK
property portfolio.

Joining forces with British Airways Pension Fund, Tesco has entered into a
partnership that will release funding for its future growth, whilst maintaining
the flexibility to operate and adapt its property assets.

The 50/50 joint venture follows Tesco's announcement in April 2006 of a property
sale and leaseback programme that is expected to realise proceeds of up to £5bn
over five years from its extensive freehold estate.

The joint venture takes advantage of attractive conditions within the debt and
equity markets, being reflected in an initial yield of less than 4.5%. The sole
debt provider was Deutsche Bank AG London.

The transaction includes 16 Tesco stores, accounting for 2% of Tesco UK property
assets by gross floor area. The joint venture is for a term of 20 years with an
early termination option in 2016. Annual rental uplifts are linked to a limited
prices index calculated by reference to RPI, collared between zero and 3.5% per
annum.


Contacts:

Investor Relations:     Steve Webb              01992 644 800
Press:                  Jonathan Church         01992 644 645
                        Angus Maitland          020 7379 5151





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