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Tesco offloads loss making Fresh & Easy chain | Tesco offloads loss making Fresh & Easy chain |
(35 minutes later) | |
Tesco has agreed to sell 150 of its Fresh & Easy stores to the investment company Yucaipa Companies. | Tesco has agreed to sell 150 of its Fresh & Easy stores to the investment company Yucaipa Companies. |
The British supermarket giant, the world's third largest retailer, has been looking to dispose of its loss-making US food chain for some time. | The British supermarket giant, the world's third largest retailer, has been looking to dispose of its loss-making US food chain for some time. |
Around 4,000 of Fresh & Easy's 5,000 employees are to transfer to the new business as part of the deal. | Around 4,000 of Fresh & Easy's 5,000 employees are to transfer to the new business as part of the deal. |
Tesco said in a statement that this is an "orderly and efficient exit from the US market". | Tesco said in a statement that this is an "orderly and efficient exit from the US market". |
Under the terms of the deal, Tesco will loan the new business around £80m. | Under the terms of the deal, Tesco will loan the new business around £80m. |
Fresh & Easy, which operates 200 stores across California, Nevada and Arizona, has lost money since opening in 2007. | |
Tesco did not specify which stores are being transferred and what will happen to the fifty stores not being taken over by Yucaipa. | |
Yucaipa is a Los Angeles based private equity company focused on supermaket and restaurant businesses and is run by billionaire investor Ron Burkle. | |
In April of this year, Tesco reported its first fall in annual profits for 20 years. |