Tesco pulls out of Japanese market
Supermarket giant Tesco is to sell its stores in Japan after admitting defeat in its eight-year push to become a major player in the country.
Japan is the smallest of Tesco's international businesses, with 129 small stores in the Greater Tokyo area under the Tsurakame and Tesco formats.
The UK retailer has been in the country since 2003 but Philip Clarke, who became Tesco chief executive earlier this year, conceded that it had not been possible to build a "sufficiently scalable business".
The Japanese arm saw like-for-like sales drop 8.1% in the year to February as difficult trading conditions took their toll.
Tesco has 1,400 stores in Asia, with larger businesses in China, Korea, Malaysia and Thailand.
It moved into Japan with the 2003 acquisition of C2 Network, which at the time owned 78 convenience stores and was valued at £173 million.
Tesco's shares opened 1% higher today as analysts welcomed the decision to end the Japanese venture.
Kate Calvert, a retail analyst at Seymour Pierce stockbrokers, said: "Japan will remain a notoriously difficult country to make money out of, as Wal-Mart is also finding, having had a presence in Japan since 2002 through Seiyu."