Tesco has bolstered its cash position with a £605m sale and leaseback of properties to insurers and pension funds.

The decision to use the vast portfolio of freehold supermarkets more aggressively was announced in 2006 when Tesco said it planned to sell up to £5bn of property over the next five years.

Yesterday’s deal saw 13 Tesco stores, about 2.4% of the portfolio’s value, sold to the Universities Superannuation Scheme, PRUPIM, LaSalle Investment Management and Canada Life in a mixture of joint venture and 100 per cent sale agreements.

The joint venture structure allows Tesco to cash in on part of the value of the stores while keeping operational flexibility.

Financial Times