Tesco may pull out from South Korea

Tesco may pull out from South Korea

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UK retail giant Tesco may exit South Korea as discount chain Homeplus faces shut down.

MNC retailer Tesco may reportedly discontinue its Korean operations as the impending visit of the new CEO, could mean the shut down of discount chain Homeplus, the company’s South Korean unit. 

Tesco Homeplus_pull out korea

Homeplus is South Korea’s second largest discount store retail chain, just behind Shinsegae Group. However, it has been suffering from declining profits in the last three years. Tesco operates through 400 stores and 198 franchise stores in South Korea, and serves over six million customers in the country every week.

In addition, the company is currently under fire as many of its high-ranking officials, including its then CEO Do-Sung-hwan, face prosecutorial investigation for allegedly selling personal information of over five million customers to insurance firms over past few years. 

The company has also launched an investigation into the £250 million accounting gap. Homeplus executives have been reportedly banned from leaving the country till the investigation is done.

As per reports, Tesco hired Dave Lewis, formerly from Unilever, as the new CEO of the company to turnaround the business and the company’s image. His role is focused on reviewing international operations of the company and restructure, if necessary.

Homeplus is the only presence that Tesco has in Northeast Asia. In 2012, the company decided to pull out of Japan and China, owing to poor performance. 

Photo Credits: mass-imo.com