Tesco

Sale-leaseback Financing

Retail-Stores

July 2009

Tesco is the world’s fourth-largest retailer, employing over 470,000 employees in fourteen countries worldwide.  The U.K.-based Company is a well-known provider of groceries, electronics, furniture and appliances, clothing and jewelry, as well as banking and insurance services.

Situation: This transaction was part of Tesco’s program to strengthen its balance sheet by realizing the liquidity embedded its extensive property portfolio. 

Financing: Tesco received $90 million in financing through the sale-leaseback of its Budapest property holdings with The W. P. Carey Group. 

Outcome:  Tesco gained access to significant capital by entering the transaction with The W. P. Carey Group.  W. P. Carey became the owner of two national distribution centers that provide fresh and non-perishable groceries throughout Hungary and that are critical assets for Tesco’s Eastern European operations.