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Tesco is believed to be eyeing a move into Russia's swiftly expanding retail market amid reports that it has held informal talks with Russia's biggest supermarket chain, X5 Retail Group.
X5, which controls or owns the franchise to more than 1200 food stores across Russia and the former Soviet Union, said recently it did not rule out a commercial partnership with Tesco while insisting it was not preparing to sell its business.
Its statement raises the possibility that the UK supermarket giant may follow the likes of BHS, Marks & Spencer, Burberry, Monsoon and Mothercare, and join Russia's burgeoning retail revolution.
The country's retail food market is expected to expand by an annual rate of 16 per cent between now and 2010.
According to the daily Kommersant newspaper, X5, a Moscow-based supermarket chain, has held or is preparing to hold talks with two other foreign retailers apart from Tesco.
The newspaper named America's Wal-Mart and France's Carrefour as Tesco's rivals. More specifically, it said the meetings centred on the possibility of buying a controlling stake in the firm in 2008 after X5 exercises an option to buy a chain of Russian hypermarkets.
Such a stake would give a foreign retailer a head start on its competitors, sparing it the difficult task of starting from scratch and growing organically in a market notorious for corruption and red tape. X5 insisted it was not planning to turn over its business to a foreign retailer altogether but appeared to leave the door open to some kind of cooperation.
"The company and its major shareholders do not intend to sell its business in a medium-term perspective and are focused on the realisation of a five-year strategy of the group's development on the Russian market," Lev Khasis, X5's chief executive, said.
"We do not exclude, however, potential partnerships with these chains in various areas of mutual interest."
Tesco said it did not respond to "rumour and speculation", but said "never say never" when asked whether it had any plans to expand into Russia. Tesco has stores in 12 countries outside the UK and is keen to expand in emerging markets.
- INDEPENDENT
