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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.

David Cameron shows Labour how to do it

Leftwing rhetoric masked rightwing reality in Cameron's conference speech.

“The tanks are in the kitchen,” was the gloomy verdict of one Labour staffer to a speech in which the Prime Minister roamed freely into traditional left-wing territory.

But don’t be fooled: David Cameron is still the leader of an incredibly right-wing government for all the liberal-left applause lines.

He gave a very moving account of the difficulties faced by careleavers: but it is his government that is denying careleavers the right to claim housing benefit after they turn 22.

He made a powerful case for expanding home ownership: but his proposed solution is a bung for buy-to-let boomers and dual-earner childless couples, the only working-age demographic to do better under Cameron than under Labour.

On policy, he made just one real concession to the left: he stuck to his guns on equal rights and continued his government’s assault on the ridiculous abuse of stop-and-search. Neither of these are small issues, and they are a world away from the Conservative party before Cameron – but they also don’t cost anything.

In exchange for a few warm words, Cameron will get the breathing space to implement a true-blue Conservative agenda, with an ever-shrinking state for most of Britain, accompanied by largesse for well-heeled pensioners, yuppie couples, and small traders.

But in doing so, he gave Labour a lesson in what they must do to win again. Policy-wise,it is Labour – with their plans to put rocketboosters under the number of new housing units built – who have the better plan to spread home ownership than Cameron’s marginal solutions. But last week, John McDonnelll focussed on the 100,000 children in temporary accomodation. They are undoubtedly the biggest and most deserving victims of Britain’s increasingly dysfunctional housing market. But Labour can’t get a Commons majority – or even win enough seats to form a minority government – if they only talk about why their policies are right for the poor. They can’t even get a majority of votes from the poor that way.

What’s the answer to Britain’s housing crisis? It’s more housebuilding, including more social housing. Labour can do what Cameron did today in Manchester – and deliver radical policy with moderate rhetoric, or they can lose.

But perhaps, if Cameron feels like the wrong role model, they could learn from a poster at the People’s History Museum, taken not from Labour’s Blairite triumphs or even the 1960s, but from 1945: “Everyone – yes, everyone – will be better off under a Labour government”.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.