Retailer Tesco has started a programme to buy back shares with a value of up to £500m, it said today.

The group had said when it published half year results on October 6 that it could afford to start a multi-year share buyback.

At the time Tesco chief executive Ken Murphy denied the buyback was a tactic to ward off private equity bidders.

Rivals Asda and Morrisons have both succumbed to private equity bids this year.

Tesco said Citigroup will repurchase shares on its behalf.