Tesco, Britain's largest retailer by sales, has agreed to sell 150 of its money-losing Fresh & Easy stores in the United States to a U.S. investment firm.
The company said Tuesday that the deal with Yucaipa Companies — a Los Angeles-based holding company founded by billionaire Ronald Burkle — does not include 50 further stores, which will be closed in the coming weeks.
Burkle is the former owner of grocery chains including Dominick's, Ralph’s and Food 4 Less.
"There might be an opportunity for Burkle to develop this into a specialty store," said KPCC's business analyst Mark Lacter. "It may not exactly be the way it currently is because that doesn't seem to be very successful, but there's nothing to stop him from having a smallish store that people like to go to because it's convenient."
Nonetheless, Tesco chief executive Philip Clarke said more than 4,000 jobs will be protected by the sale.
"The decision we are announcing today represents the best outcome for Tesco shareholders and Fresh & Easy's stakeholders. It offers us an orderly and efficient exit from the US market, while protecting the jobs of more than 4,000 colleagues at Fresh & Easy," Clarke said in a statement.
Fresh & Easy Neighborhood Market released an official Facebook statement discussing the acquisition:
"We are very pleased that this agreement with Yucaipa preserves more than 4,000 jobs and a vast majority of the business. Unfortunately, as a result of this agreement some stores will be closing."
Tesco said in April it planned to sell its U.S. stores, which were based in Arizona, California and Nevada. At the time, the company said its U.S. foray had lost it some 1.2 billion pounds ($1.8 billion).
The acquisition agreement will be completed within the next three months, according to a statement from Tesco.
Fresh & Easy opened its first stores in 2007, with 200 neighborhood markets throughout California, Nevada and Arizona.