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Homeplus-subsidiary merger

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(Globalpost/GlobalPost)

SEOUL, March 8 (Yonhap) -- Homeplus Co., the South Korean unit of British retail giant Tesco Plc, is considering merging its unit Homeplus Tesco Co. to increase its sales volume, industry sources said Friday.

Homeplus, the second largest discount retailer in South Korea, bought a whole stake in Homever, the country's No. 4 discount chain operator in May 2008 from E-Land Group, a local fashion retailing group which acquired the discount chain from French retailer Carrefour SA in 2006.

"After the acquisition, Homeplus has operated Homever -- renamed as Homeplus Tesco -- as its subsidiary due to wage disparity between the two companies," an official at Homeplus said, on condition of anonymity. "For now, there is no problem in merging the two companies as the wage disparity nearly eased."

"However, it has yet to be decided on whether the merger will take place," another Homeplus official said.

Homeplus has 133 stores across South Korea, including 33 outlets of Homeplus Tesco.

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