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Sunset for Tesco Japan as it sells 50 per cent of its shares to Aeon

The UK-based retailer exits from the Japanese market after nine years.

After nine years in the Japanese market, Tesco has announced that it has formalised its exit arrangements. The British retailer has signed an agreement with Aeon, the Asian country's largest retail group, to sell 50 per cent of its shares in Tesco Japan for a nominal sum.

Tesco entered Japan in 2003 through the acquisition of C2 Network, which ran stores under the Tsurakame brand. The business currently comprises 117 small stores, primarily under the Tsurakame, Tesco and Tesco Express fascias in the greater Tokyo area.

The British retailer’s decision to exit the Japanese market will result in the formation of a joint venture with Aeon. As part of this, Tesco will invest approximately £40m as a joint venture partner to finance further restructuring, after which Tesco will have no further financial exposure to the Japanese business or its operations.

Philip Clarke, CEO of Tesco, said:

I thank our colleagues in Japan, who have done an excellent job for the business, in particular over recent months. We are very pleased to announce this deal with Aeon today and are confident that this will deliver the best outcome for our staff, for our customers in Japan and for our shareholders.

The British retailer announced its decision to sell its Japanese business in 2011.

Aeon operates over 1,200 supermarket stores across Japan. In fiscal year 2011-2012, Aeon’s operating revenue and operating profit were ¥5206.1bn and ¥195.6bn, respectively.

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Geoffrey Howe dies, aged 88

Howe was Margaret Thatcher's longest serving Cabinet minister – and the man credited with precipitating her downfall.

The former Conservative chancellor Lord Howe, a key figure in the Thatcher government, has died of a suspected heart attack, his family has said. He was 88.

Geoffrey Howe was the longest-serving member of Margaret Thatcher's Cabinet, playing a key role in both her government and her downfall. Born in Port Talbot in 1926, he began his career as a lawyer, and was first elected to parliament in 1964, but lost his seat just 18 months later.

Returning as MP for Reigate in the Conservative election victory of 1970, he served in the government of Edward Heath, first as Solicitor General for England & Wales, then as a Minister of State for Trade. When Margaret Thatcher became opposition leader in 1975, she named Howe as her shadow chancellor.

He retained this brief when the party returned to government in 1979. In the controversial budget of 1981, he outlined a radical monetarist programme, abandoning then-mainstream economic thinking by attempting to rapidly tackle the deficit at a time of recession and unemployment. Following the 1983 election, he was appointed as foreign secretary, in which post he negotiated the return of Hong Kong to China.

In 1989, Thatcher demoted Howe to the position of leader of the house and deputy prime minister. And on 1 November 1990, following disagreements over Britain's relationship with Europe, he resigned from the Cabinet altogether. 

Twelve days later, in a powerful speech explaining his resignation, he attacked the prime minister's attitude to Brussels, and called on his former colleagues to "consider their own response to the tragic conflict of loyalties with which I have myself wrestled for perhaps too long".

Labour Chancellor Denis Healey once described an attack from Howe as "like being savaged by a dead sheep" - but his resignation speech is widely credited for triggering the process that led to Thatcher's downfall. Nine days later, her premiership was over.

Howe retired from the Commons in 1992, and was made a life peer as Baron Howe of Aberavon. He later said that his resignation speech "was not intended as a challenge, it was intended as a way of summarising the importance of Europe". 

Nonetheless, he added: "I am sure that, without [Thatcher's] resignation, we would not have won the 1992 election... If there had been a Labour government from 1992 onwards, New Labour would never have been born."

Jonn Elledge is the editor of the New Statesman's sister site CityMetric. He is on Twitter, far too much, as @JonnElledge.