Tesco Plc, a U.K. supermarket chain with GBP23.7 billion (USD37.2 billion) in annual sales, is examining the possibility of using credit derivatives for its investment portfolio. Keith Richardson, treasurer in Cheshunt, U.K., said the company has just begun speaking to investment banks to get a better grasp of the market. However, he said this is not an imminent foray and declined to disclose to which firms it is speaking.
Richardson said, "We are examining whether we are managing our investments in the most effective and efficient manner." If the company were to go ahead with the strategy it would invariably use them for both hedging and to gain exposure--through selling credit protection, according to Richardson.
The grocery store chain has a small investment portfolio, since it uses most of its cash for company expansion, noted Richardson. He declined to disclose the size of the portfolio.
