Variety store group Woolworths has struck an agreement to sell the leases on up to nine stores to Tesco for up to £9 million and will use the cash to reduce borrowings.

Woolworths said: “The transfers of the individual leases are subject to individual conditions and, subject to fulfilment of these conditions, would be expected to occur on a lease by lease basis over the next six months.”

The transfer of all nine leases would generate a profit for Woolworths of about£7 million, which would be counted as part of its operating profit from property transactions.

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