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Tesco: sale and leaseback

Read the article Tesco funds more expansion abroad with $570m sale and leaseback deal and then have a go at the questions below. You can either read the article in the window below, or follow the previous link to open the article in a new window.

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Tesco has a long history of using sale and leaseback as a source of finance to fund its global expansion programme. Read more from the articles below to help answer the questions.


Question 1

Define the terms 'sale and leaseback' and 'joint venture'.

Question 2

Explain why Tesco has chosen to enter a joint venture to sell and leaseback a number of their stores.

Question 3

Examine three other sources of finance that Tesco could have used instead of sale and leaseback to fund their international expansion plans.

Question 4

Discuss the advantages and disadvantages of using sale and leaseback to fund further international expansion for Tesco.

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Extension activity:

With reference to the Ansoff's Matrix, analyse the strategic growth options that Tesco have chosen to pursue.