Mounting merger rumours at Tesco

24 November 2004 – London (UK): Shares at the UK’s largest supermarket chain Tesco rose today on the back of roused speculation of a merger with French retail giant Carrefour.

Rumours were fuelled by an interview that Tesco’s chief executive Terry Leahy gave to European Business magazine in which he said he would consider a merger to take on US giant Wal-Mart.

Although Leahy did not mention Carrefour in the interview, the article quoted analysts as saying that consolidation was inevitable and that a merger between Tesco and Carrefour would be one way for the UK chain to combat Wal-Mart.

Several dealers however remained sceptical that a deal was imminent.