Tesco Buys Restaurant Chain Amid Revamp
Tesco has paid £48.6m for the Giraffe restaurant chain as it looks to make its stores more attractive to shoppers.
Criticised in the past for a 'plastic' in-store look, the UK's biggest supermarket chain has been spending millions on a revamp that will now include eateries under the Giraffe brand at its larger premises.
The child-friendly restaurant business, which has 48 outlets, is seen as a crucial strategy to boost flagging UK sales at Tesco.
It suffered a difficult 2012 when it reported its first drop in profits for two decades.
While sales improved over Christmas, growing by 1.8% in the six weeks to January 5, the horsemeat scandal is expected to have taken its toll on trading in recent months.
On Tuesday night, after three products had previously tested positive for horse DNA, the chain withdrew a frozen roast meatloaf from sale having declared 11 days ago that its remaining ranges were clear.
A Which? study released on Wednesday found that more than half of consumers had changed their shopping habits as a result of the wider scandal.
The consumer group's separate annual poll of shoppers had suggested that Tesco was the country's most complained-about supermarket chain.
Tesco's statement confirming the purchase of Giraffe said: "The acquisition forms part of Tesco's strategy to develop the space in some of its larger stores and create even more compelling retail destinations where customers can meet, eat and drink, as well as shop.
"The first Giraffe restaurant to open next to a Tesco store will be near London.
Kevin Grace, Group Commercial Director at Tesco, added: "We invest in businesses that add value for our customers online or offline; as we've done with Harris + Hoole, Euphorium, blinkbox, and now Giraffe."
He concluded: "We think our customers will love it."
The original founders, husband and wife team Russel and Juliette Joffe, along with Andrew Jacobs, will remain in place despite the deal netting them a hefty windfall.