City fund manager Tom Dobell has attacked Tesco for “endlessly persecuting” its suppliers.
Dobell, regarded as one of the most successful fund managers in the City, issued an unusual broadside against the UK’s largest retailer, The Times reported.
Dobell runs Prudential’s £7.6bn M&G Recovery Fund and is known for his controversial stances. He refuses to invest in all banks except HSBC and has called hedge funds “selfish and devious”.
He said in his annual letter to shareholders: “We…remain cautious on the food retailers, especially Tesco, where space expansion and an endless persecution of suppliers is, in our view, unsustainable.”
A Tesco spokesman countered: “We have positive and collaborative relationships with our suppliers. Over 1,500 of them have worked closely with us for more than five years.”
Dobell has shares in some of Tesco’s biggest suppliers. He owns £236m of Unilever shares and £33m of shares in cider maker C&C.
Large grocers are often attacked by food industry bodies including the National Farmers Union for allegedly harsh trading terms but an attack from a City fund manager is unusual.