A raft of major banks and fund managers have joined Harris Associates in dumping Tesco shares following its profit warning on Friday.
Institutions including Deutsche Bank, Invesco and State Street have disposed of shares since Friday, with Deusche selling 18 million shares worth £40m for its clients yesterday, on top of the £6m it sold last month, The Independent reported.
Meanwhile, Invesco sold 3.5 million shares on Friday, worth £8m, and State Street offloaded nearly £1m worth.
This adds to the almost £400m in shares that Tesco’s biggest investors have sold in the past two months. Axa, Brewin Dolphin, Scottish fund manager Walter Scott & Partners, ABN Amro, JPMorgan and Legal & General have all recently sold shares in Tesco.
The grocer last week parachuted in new chief executive Dave Lewis, a former Unilever executive, a month early following Friday’s profit warning.
At the weekend, it emerged that one of Tesco’s biggest shareholders, US investment fund Harris Associates, had sold two-thirds of its stake in recent weeks and blasted the grocer for having no clear strategy.
In an email seen by Retail Week, Lewis, who succeeds Philip Clarke, said: “These are challenging times, but we will emerge stronger. With a relentless focus on our customers and a preparedness to challenge ourselves and take bold decisions we can retain our position as the customers’ champion. This is a great business made up of great people, with real expertise and I am confident that together we can succeed.”
Tesco has reduced its dividend by 75% in order to provide Lewis with more cash to make changes at the struggling retailer.