Temasek joins MBK in bid for Tesco's S. Korea business -sources

* Pair bidding against Carlyle, KKR, others

* Carlyle partnered Singapore's GIC

* Rare instance of Temasek and GIC in competing bids (Adds Temasek's retail push, portfolio, context)

By Saeed Azhar

SINGAPORE, Aug 27 (Reuters) - Singapore state investor Temasek Holdings (Private) Ltd has partnered Asia-focused private equity firm MBK Partners to bid for the South Korea arm of British supermarket operator Tesco PLC (Xetra: 852647 - news) , two people familiar with the matter told Reuters.

MBK has already entered the race for the business, valued at $6 billion. It (Other OTC: ITGL - news) is vying against Carlyle Group LP and a consortium comprising Affinity Equity Partners and KKR & Co , Reuters reported on Tuesday..

Temasek's latest interest in a consumer-sector deal comes more than a year after it bought almost a quarter of health and beauty retailer A.S (Other OTC: UBGXF - news) . Watson, backed by Hong Kong tycoon Li Ka-shing, for about $5.7 billion in its single biggest investment.

Temasek, which has 28 percent of its $197 billion portfolio in financial services, has been diversifying its portfolio in recent years, moving into consumer and life sciences.

The share of consumer and real estate companies rose to 15 percent of its assets as of March 31 from 11 percent two years earlier.

A Temasek spokeswoman declined to comment on interest in Tesco, and a spokesman for MBK could not be immediately reached. The people familiar with the matter declined to be identified because the information is confidential.

The people said Temasek's entry marks a rare instance where the fund is bidding against fellow Singapore sovereign wealth fund GIC, which has partnered Carlyle. (Reporting by Saeed Azhar; Additinoal reporting by Joyce Lee in SEOUL; Editing by Christopher Cushing)