Lazada serves Thailand, Malaysia, Indonesia, Vietnam and the Philippines

Lazada serves Thailand, Malaysia, Indonesia, Vietnam and the Philippines

UK retail giant Tesco has acquired a minority stake in South East Asian e-commerce retailer Lazada.

The retail group has made the investment as it looks to bolster its e-commerce capabilities while pulling back on store expansion. Financial details of the deal were not disclosed.

Lazada, founded by German venture capital group Rocket Internet last year, sells non-food goods including clothing, homeware and electronic goods, to Thailand, Malaysia, Indonesia, Vietnam and the Philippines.

Robin Terrell, group multichannel director of Tesco, said the investment in South East Asia's largest e-commerce retailer continues its strategy of "developing leading multichannel businesses in core growth markets".

"Lazada is an exciting, pioneering business which has developed a market-leading offer in each of its five markets in just 18 months. As South East Asia's 600m onsumers begin to use smartphone technology to access retailers online, Lazada has established a strong position from which to grow," said Terrell.

Tesco last week emphasised its desire to establish multichannel leadership as it attempts to differentiate itself amid growing competition from German discounters Aldi and Lidl at the lower end of the market and the higher-end supermarkets, such as Waitrose.

In its third-quarter sales last week, Tesco saw its share price fall after booking like-for-like sales declines in all its regions.