LONDON, Oct 2: Britain’s biggest retailer, Tesco, on Wednesday pushed ahead with plans to create a supermarket giant in China, as it seeks to offset a slump in profits on weaker European sales.

Tesco will combine its Chinese business with that of Hong Kong-listed retailer China Resources Enterprise (CRE) to form a joint venture, it revealed in a statement.

The British supermarket -- the world’s third biggest -- announced also that its net profit slumped by a third in the group’s first half.

Tesco reported that net profits dived 33.6 per cent to 820 million pounds ($1.3 billion, 981m euros) in the first half of its financial year, or 26 weeks to August 24.

That compared with profit after tax of 1.24bn pounds in the equivalent period a year earlier. Revenue rose 1.9pc to 31.91bn pounds.

London-listed Tesco said the Chinese move was part of its international strategy to tap further into fast-growing economies.—AFP