Tesco fails in the US: Fresh and Easy to be sold

UK retailer Tesco PLC’s ambitious U.S. experiment -- 5-year-old grocery chain Fresh &Easy -- has failed after costing its British parent billions of dollars, the company said Wednesday.

After a strategic review of the brand in the last year, during which Tesco had indicated it might limp back across the pond to lick its wounds, the largest British grocer confirmed its “exit from the United States.”

Tesco's Financial Results statement that also confirms its intended US exit.

Tesco will attempt to sell Fresh &Easy and its 200 stores in California, Arizona and Nevada. The chain launched to great fanfare in November 2007 – just before the recession and sub-prime mortgage crisis swept through the U.S., causing Americans to retreat to the security of familiar brands.

Even without the economic turmoil, the gamble would have been a dangerous one. The U.S. grocery category is saturated with longstanding, homegrown names such as Wal-Mart, Costco, Whole Foods and Trader Joe’s.