Tesco has filed Chapter 11 bankruptcy proceedings for its failed US venture Fresh & Easy as it takes the final steps towards its US exit.
The move paves the way for the Fresh & Easy chain’s sale to private equity firm Yucaipa, led by billionaire Ron Burkle.
Tesco, which presents its interim results tomorrow, is known to have been anxious to limit further exposure to shareholders from its US operation but it said it would result in 4,000 jobs being preserved, out of just short of 5,000.
Under the proposed sale, an affiliate of Tesco will lend Burkle’s private equity firm Yucaipa Companies $120m (£73.8m) to help fund the takeover of the loss-making chain. Yucaipa has said it will keep 150 stores running.
Comment: Farewell Fresh & Easy