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Daily Mirror
Daily Mirror
Business
Emma Munbodh

Tesco to break ties with Carrefour after joining forces to 'cut prices' for shoppers

Tesco is set to end its partnership with French grocer Carrefour, three years after joining forces to help bring more competitive prices to customers.

The trial was signed in 2018, and promised to reduce prices and expand ranges of own-label products for shoppers in both countries.

In a joint statement on Monday, the two chains said the deal, which began two years after Britain voted to leave the EU, will not be renewed.

A statement said the two supermarkets “have decided not to extend their purchasing alliance beyond the three-year operational framework agreed in 2018."

The alliance formally ends on December 31, they said, adding that the two would now focus on opportunities independently.

Tesco is the UK's largest retailer while Carrefour is Europe's largest (Getty)

Carrefour, Europe's largest supermarket chain, agreed to buy Brazil's third-biggest food retailer Grupo BIG earlier this year.

Unveiling its partnership with Carrefour in 2018, Tesco said the three year trial would see the two chains collaborate across own brand produce to deliver more competitive prices, while also enhancing "the quality and choice of products".

However, it insisted that each company would continue to work with supplier partners at a local and national level.

It formed part of the grocer's long-term transformation, dubbed 'Project Reset' as it battled to beat competition from Aldi and Lidl.

In May, Tesco reported a 20% drop in full-year pretax profit, revealing the pandemic had wiped an "exceptionally strong" year of grocery sales.

The supermarket giant said that pre-tax profits slid to £82million for the 12 months to February, compared with £1.03billion the previous year.

It said profits were weighed down by £892million in Covid-related costs and the company's decision to hand £585million in business rates relief back to the Government.

Tesco is also preparing to axe its Metro stores format, in an overhaul that will see dozens of stores rebranded into superstores this summer.

The move will see 147 Metro stores rebranded into Express and Extra superstores.

It comes two years after the chain launched a restructuring into Metro stores following a decline in sales due to market competition.

The changes were announced internally to staff in May, with the rebranding to be carried out over the next few months.

A spokeswoman told The Mirror stores will receive new fascias over the coming months but will continue to trade normally throughout. She added that no colleagues are affected by the changes in addition to the 4,500 jobs cut in 2019.

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