September 12, 2013
More than 150 of the 200 Fresh & Easy Neighborhood Markets locations operated by U.K.-based retailer Tesco are to be turned over to Yucaipa Companies. The 50 stores that were not transferred in the deal will be closed, meaning that the clock is ticking for three San Diego County locations and five Sacramento shops. A spokesperson said that a number of other stores could be closed in the San Diego area and that these locations will soon begin liquidating their stock at sale prices.
Yucaipa Companies has completed more than $35 billion dollars' worth of mergers since the corporation was founded in the 1980s. The firm's spokesperson said that the company plans on building on the existing Fresh & Easy brand and migrating it into a more modern retail firm. Market analysts say that the low investment costs of this unspecified deal may serve as a boon for Yucaipa.
Tesco's CEO released a statement asserting that the deal was the best option for stakeholders of both Fresh & Easy and Tesco. Tesco previously reported almost $2 billion in U.S. losses during a six-year period, and the venture has continually caused problems for the U.K. firm. Of the 5,000 employees who work at Fresh & Easy stores in California, Nevada and Arizona, over 4,000 will keep their jobs.
Business mergers and acquisitions affect far more people than just the decision-makers who want to sell their firms. The fact that employees may lose their jobs and that shareholders have a say mean that deals must be planned so that they benefit everyone. Business formation attorneys may be able to help owners structure deals so that they can profit from the sale of their companies or the acquisition of new entities.
Source: U-T San Diego, "2 Fresh & Easy stores closing in San Diego", Katherine Poythress, September 10, 2013