Tesco is poised to enter China after a three-year search for a suitable partner, according to local press reports.

Tesco is understood to be in talks to buy a 50% stake in the Hymall hypermarket chain, which operates 25 hypermarkets under the Hymall and Le Gou brands. A subsidiary of food processor and retailer Ting Hsin International, Hymall has annual sales of about £259m, said a Citigroup Smith Barney report into grocery retailing in the Far East.

The deal would enable Tesco to “leapfrog above Carrefour” in Shanghai and provide “a springboard for roll-out” in the country, said the report.