Large Tesco store

Tesco has continued the sell-off of its non-core operations with the agreement to sell an 8.6% equity stake in South East Asian e-commerce group Lazada to Chinese retail giant Alibaba for $129m (£90.5m) in cash.

It comes as reports surface that the supermarket group has appointed advisors to help it dispose of loss-making garden centre business Dobbies, as well as the Harris & Hoole coffee shops and family restaurant chain Giraffe.

Tesco first invested in Singapore-headquartered Lazada in November 2013 and prior to the sales held a 19.6% stake in the business having invested £124m to date.

Alibaba has also invested $500m in Lazada to becoming the controlling shareholder, giving the e-commerce business a $1.5bn valuation.

Tesco will still have an 8.3% share in the business following the deal, with Lazada shareholders, including Tesco, entering into a put-call arrangement with Alibaba to give the Chinese retailer the right to purchase the remainder of the group within the 12 to 18 months period.

Tesco said it would the proceeds from the transaction for general working capital purposes.

Tesco has sold its business in South Korea for £4bn since CEO Dave Lewis took charge and called off an auction of data arm Dunnhumby when it failed to attract high enough offers. There is also speculation Lewis may close the Euphorium bakery business after healthy living business Nutricentre was shut down earlier this month.

Tesco is set to announce its full-year figures tomorrow with the City optimistic that the retailer will reveal its first quarterly rise in like-for-like sales for more than three years.