By City News Service
The equity firm controlled by billionaire Ron Burkle announced Tuesday it is buying El Segundo-based Fresh & Easy Neighborhood Market from U.K.-based Tesco, but terms of the deal were not released.
The deal, in which Yucaipa Cos. will assume Fresh & Easy's debt, is expected to be completed in about three months.
Locally, a Fresh & Easy store is at 1700-C Rosecrans Avenue, near BevMo and Office Depot next to a shopping center that includes Trader Joe's and Il Fornaio. Another one is at 727 Pacific Coast Hwy., Hermosa Beach.
"Fresh & Easy is a tremendous foundation," Burkle said. "Tesco should be applauded for giving their customers an affordable, healthy, convenient shopping experience. Its dedicated employees and great base of customers give us a solid starting point to complete Tesco's vision with some changes that we think will make it even more relevant to today's consumer. We plan on continuing to build Fresh & Easy into a 'next-generation convenience retail experience,' providing busy consumers with more local and healthy access for their daily needs."
Yucaipa Cos., founded in 1986, has used leveraged buyouts to acquire majority positions in grocery store chains such as Ralphs and Kroger. More recently, Yucaipa Cos. bought a stake in The Great Atlantic & Pacific Tea Co. and Barney's New York.
Philip Clarke, Tesco's chief executive, said the sale was the best for Tesco shareholders and Fresh & Easy's stakeholders.
"It offers us an orderly and efficient exit from the U.S. market, while protecting the jobs of more than 4,000 colleagues at Fresh & Easy," he said.
Fresh & Easy, which targeted California and the Southwest when it entered the U.S. market in 2007, has about 150 stores nationwide and a distribution hub in Riverside. Tesco is the No. 3 retailer worldwide in terms of sales, behind Wal-Mart Stores Inc. and Carrefour SA.