A similar amount is expected to be raised through a wider programme of improvements in managing working capital and property sales, which will be used to reduce debt and strengthen the company's credit rating.
Tesco chief executive Terry Leahy said: "All parts of our long-term strategy for growth are delivering. Now is the right time to strengthen our finances further so that we can take full advantage of the opportunities available. This placing will give Tesco the firepower and flexibility to stay ahead and to maximise the full potential of our four-part growth strategy."
The cash will be used for a variety of purposes. In the UK, for example, Tesco said that it saw "significant areas for growth". The Tesco Extra fascia will be expanded to include a broader range of non-food items such as clothing and health and beauty items, while Tesco's drive into the fast-moving convenience store sector will also continue with the roll out of more Express stores. Finally, the company reaffirmed its intention to bid for a number of Safeway stores offloaded by Morrisons as part of its takeover.
But the money will not be used solely for UK retail developments. The Tesco Personal Finance and Tesco Mobile operations have proven to be such a success that the company is investigating a number of other avenues to strengthen its position as a one-stop-shop for a range of products and services.
Tesco is already by far the most international of the UK supermarket groups, but it has no intention of resting on its laurels. The company said it aimed to be the number one food retailer in all of its 11 overseas markets, and that the cash raised by the placement would help it move closer to achieving this goal.
"There are opportunities beyond Tesco's initial expectations and where Tesco has scale in a country and a market leading position, returns on investment are enhanced," the company said.
"In Tesco's lead markets of Hungary, Thailand and Korea, cash returns on investment (CROI) for stores open more than a year are already around 15 per cent. Developing new stores and taking new formats such as Express and product ranges such as Value overseas should therefore provide new and faster growth."
Tesco's "simple strategy that has been well executed" is in stark contrast to Sainsbury's laboured restructuring efforts over the last few years, and its continued drive into the multi store format used so successfully by European powerhouses such as Carrefour should help it widen the gap even further.
That gap is already worryingly wide, at least from Sainsbury's point of view. The latter group yesterday said that its 2 per cent increase in like-for-like sales over the Christmas period was good news, but this positive spin on the end-of-year performance looks decidedly hollow in the light of Tesco's 7.7 per cent UK sales improvement announced today.
But if the like-for-like comparison makes for disappointing reading for Sainsbury, this is nothing compared to the actual sales figure - Tesco reported a 16.7 per cent increase in sales in the seven weeks to 3 January, with UK sales ahead 15.4 per cent. In contrast, Sainsbury managed growth of just 1.8 per cent for the whole of the final quarter.
Tesco said that its good performance was due to the advances on all four of its strategic fronts - improvements in its UK business, an increase in non-food sales, the development of new retail services and international expansion.
Total UK sales for the seven weeks were up 15.4 per cent, while the like-for-like increase of 7.5 per cent was driven by a 7.7 per cent rise in volumes during the period.
Non-food sales continued to play an increasingly important role, in particular in the run up to Christmas, which saw DVD sales grow by 46 per cent and CD sales expand 10 times faster than the market rate, Tesco claimed.
Outside the UK, international sales were up 22 per cent over the Christmas and New Year period, in line with the company's expectations despite some tough trading conditions in markets in eastern Europe and the Far East. Tesco now has 189 hypermarkets operating overseas.
Tesco's Christmas trading figures are not directly comparable with those of Sainsbury, as the latter calculated them over a much shorter period - just four weeks, rather than seven. But this in fact inflated Sainsbury's performance, since it the improvement came only after the company put its store refit programme on hold and concentrated solely on trading throughout December.
If an additional two or three weeks from November had been included, the likelihood is that the growth would not have been as good.
But however the comparisons are made, Tesco's performance clearly indicates the widening gulf between the two rivals. Sainsbury's restructuring programme has come far too late and is not particularly inspired - it seems determined to turn itself into a Tesco clone rather than plough its own furrow - and even taking into account the disruption caused by the major store overhaul programme, there is little to show that Sainsbury will ever be able to generate the same level of sales as Tesco even by copying its trading style.