(Adds comment from Tesco unit in second paragraph.)
Feb. 9 (Bloomberg) -- Tesco Plc, the U.K.’s largest grocery chain, plans to raise about 17 billion baht ($553 million) by selling shares in a Thai property fund, the company’s local unit said.
“The money will be raised for business expansion,” Sompong Rungnirattisai, property director for Ek-Chai Distribution System Co., the company that operates Tesco’s stores in Thailand, told reporters today in Bangkok.
The fund will earn revenue from rental fees at 17 shopping malls anchored by Tesco Lotus stores and Tesco will lease its hypermarkets from the fund. Tesco has raised funds from selling and leasing back U.K. stores to finance new outlets.
The Tesco Lotus Retail Growth Freehold and Leasehold Property Fund will be the largest initial public offering of a property fund in Thailand, Ek-Chai said in a statement distributed before the briefing.
The 17 malls to be included in the fund have an appraised value of more than 17 billion baht, Ek-Chai said.
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