Tesco's troubled U.S. grocery chain Fresh & Easy may rise again—as a new version of Wild Oats, Bloomberg reported on Wednesday (June 12).
The money to buy and rebrand the 200-store chain would come from investor Ron Burkle, who was the largest shareholder in the Wild Oats Markets chain when it was sold in 2007 to Whole Foods. That deal hit regulatory problems, and while the actual stores stayed with Whole Foods, the branding was sold to former 7-Eleven CEO Jim Keyes, who reportedly would serve as Wild Oats CEO if the deal goes through.
Burkle's private equity company Yucaipa appears to have recently filed a trademark application to use the Wild Oats name for a chain of grocery stores. Both Yucaipa and Tesco declined to comment to Bloomberg on whether the companies are discussing a deal.
If a deal happens, it would keep Tesco from having to deal with the costs of dismantling the chain. It would also hand an operating grocery chain to Burkle, who was reported to be interested in buying part of SuperValu (NYSE:SVU) before it sold its Albertsons, Jewel-Osco and other stores to a rival private equity firm, Cerberus Capital Management.
It would also give the new Wild Oats room to grow. Before the original Wild Oats chain was sold to Whole Foods, it operated 109 stores in 23 U.S. states and British Columbia. Fresh & Easy's 200 stores are only in California, Arizona and Nevada.
- See this Bloomberg story
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