The Canada Pension Plan Investment Board said Monday it has agreed to acquire a 21.5 per cent stake in Homeplus, Tesco PLC’s South Korean business, for US$534 million.

The CPPIB, which invests the assets of the CPP, was part of a consortium led by MBK Partners. The total transaction value is about US$6 billion.

Homeplus has been operating in South Korea since 1999, and with more than 1,000 retail outlets across the country,  is one of the largest multi-channel retailers in Korea and the number two player in both hypermarkets and supermarkets.

“We are pleased to invest alongside our longstanding partner, MBK Partners, in one of the leading retailers in South Korea,” said Pierre Lavallée, senior managing director and global head of investment partnerships at CPPIB, in a statement. “Homeplus is an attractive investment for CPPIB as it provides us with access to one of the largest retail markets in Asia through a well-established business with a strong cash flow profile.”

CPPIB, which has been investing in South Korea since 2008, said the country remains a key investment market for it in Asia.

Garry Marr, Financial Post