London -- Tesco CEO Philip Clarke announced Wednesday that the British supermarket retailer will likely sell or close its entire U.S. presence, which means that 199 Fresh & Easy stores could be shuttered or sold off.
According to multiple reports, Tesco is close to making the decision after five unprofitable years in the U.S. The retailer launched the concept in 2007, confident there was a niche for a grocery store with fresh food offerings formatted in a unique footprint that was smaller than a typical supermarket but larger than a c-store.
"It's likely, but not certain, that our presence in America will come to an end," Philip Clarke, CEO, said. "This is a very major change for the business." Clarke said the U.S. exit would allow the company to refocus on its global portfolio.
Fresh & Easy CEO Tim Mason has resigned the company after 30 years; Mason is the son-in-law of former Tesco CEO Ian MacLaurin.
Tesco – the world’s No. 3 retailer – said it has appointed investment bank Greenhill & Co. to conduct a strategic review of the Fresh & Easy chain that could lead to the sale or closure of the near-200 stores.
Tesco, which trails France's Carrefour and U.S. leader Wal-Mart by annual sales, said it had had a number of approaches from parties interested in acquiring either all or part of Fresh & Easy, or in partnering with the firm.