Tesco launches bond to raise money for China

25th Aug 2011 14:00

Tesco announced it has raised around £70m through the launch of a Chinese Renminbi denominated bond issue in Hong Kong.The supermarket giant claimed the issue was the first of its kind by an international retailer and would be used to grow Tesco's retail operations in China.The maturity is three years and has a semi-annual coupon of 1.75% per annum. Tesco said it expected the bond to be rated 'A-' by the Standard & Poor's agency. The firm said the decision reflected Tesco's confidence in the Chinese market and strong commitment to growing a prosperous local business. "China is an important market for us and represents a great growth opportunity," said chief financial Officer, Laurie McIlwee."This is a new and innovative way of funding our business as it continues to grow and demonstrates our commitment to China."Tesco entered the Chinese market in 2004 and currently operates 96 supermarkets and 12 express stores across the country, mostly centred around Shanghai.