Affinity, KKR team up to bid for Tesco’s South Korean unit: Reuters

Private equity firms Affinity Equity Partners and KKR & Co (KKR.N) have teamed up to bid for Tesco plc’s (TSCO.L) South Korean unit valued at about $6 billion, people with knowledge of the matter said on Friday.

Carlyle Group (CG.O), another short-listed bidder, is working with Singapore’s GIC, the people told Reuters. North Asia-focused private equity firm MBK Partners will seek equity funding from South Korea’s National Pension Service to bid for the unit, the people added.

The final bids for the business are due on Aug. 24, Reuters previously reported.

Britain’s biggest supermarket group, whose credit rating was cut to “junk” status by Moody’s and S&P in January, is battling to recover from an accounting scandal and reverse market share losses in Britain to discount chains Aldi and Lidl. The sale of the South Korean unit is the biggest divestment Tesco is making to improve its financials.

The people declined to be identified as the sales process was confidential.

KKR, MBK and GIC, National Pension Service and Tesco declined to comment. Affinity and Carlyle did not offer an immediate comment.

(Reporting by Joyce Lee and Kane Wu; Additional reporting by Saeed Azhar, Anshuman Daga and Prakash Chakravarti; Editing by Denny Thomas and Muralikumar Anantharaman)