Tesco Agrees Sale Of Giraffe And Turkey Unit

Tesco (Xetra: 852647 - news) has confirmed agreements that will result in the sale of its Giraffe restaurant chain in the UK and its interests in Turkey.

The UK's biggest retailer said in a statement on Friday, after Sky News broke news of the Giraffe sale on Wednesday , that it intended to sell the chain to Boparan Restaurants Holdings Limited.

The private investment vehicle of Ranjit Boparan, who owns the Harry Ramsden's and Fishworks chains, will get 54 Giraffe restaurants including some situated at Tesco stores under the deal.

Tesco did not reveal what price Boparan paid. It (Other OTC: ITGL - news) forked out £49m for Giraffe only three years ago as then-chief executive Philip Clarke moved to bolster the shopping experience for families as Tesco looked to win back shoppers from hard discounters.

His successor, Dave Lewis, said today: "“As we stabilise the business in the UK, we continue to focus on where we can best serve the needs of our customers, while ensuring our business remains sustainable for the long-term.

"Giraffe is a much loved brand, and while casual dining remains an important part of the shopping trip for many of our customers, we will continue to meet these needs through our Tesco Cafés and other providers.

"I’d like to thank colleagues from Giraffe for all their hard work in serving our customers and we look forward to seeing it develop in the future".

Tesco added that the proposed sale of its 95.5% controlling stake in the Kipa business in Turkey to Migros would net it £30m.

The disposal marks a further stage in Tesco's international retrenchment following the sale or closure of its operations in China, South Korea and the US.

Mr Lewis also wants to sell peripheral businesses including Harris (Stuttgart: HRS.SG - news) + Hoole, the chain of coffee shops, and Dobbies, the garden centres business.