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Tesco's Fresh and Easy sold to U.S. billionaire

Yucaipa will acquire Fresh & Easy's mostly Southern California stores

Tesco's money-losing U.S. chain Fresh and Easy was sold to billionaire Ron Burkle's Yucaipa investment firm.

Under the deal, Tesco won't actually get cash. Instead, it's is essentially paying Burkle's company to take on the liabilities, with the U.K. grocer lending Yucaipa about $126 million to complete the transaction.

Burkle is no stranger to the the grocery world, having made his fortunes by turning around supermarket losers to winners. He has bought and sold Ralphs Grocery Co. and Food 4 Less, and said he would make Fresh & Easy "more relevant to today's consumer."

Fresh and Easy failed to take off in the U.S., with some saying Tesco erred in trying to convert a British retail format to the U.S. market. Tesco lost $2 billion over five years with the chain.

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