Tesco poised for dramatic exit from US

TESCO is likely to close its US franchise, Fresh & Easy, pending a strategic review of the lossmaking business.

Chief executive Philip Clarke will announce the review today alongside the retailer’s quarterly results, and will make a decision on the venture by April.

Fresh & Easy has failed to turn a profit in its five years and has been widely perceived as a failure. It operates 199 stores on the west coast of the US, employing around 5,000 people.

The business was the brainchild of former chief executive Sir Terry Leahy, who was replaced by Clarke last year. Closing the operation would be the latest in a line of failed British ventures into the US, including Marks & Spencer’s disastrous Brooks Brothers business, sold in 2001, and Midland Bank buying and selling Crocker National in the 1980s.

Sky News reported last night that investment bankers have already been appointed to assist with the review.

Tesco declined to comment.