Tesco chief executive Philip Clarke, who has just stepped into Sir Terry Leahy's shoes, has made his first acquisition. The retail giant has bought a majority stake in Blinkbox, the UK movie streaming service provider, for an undisclosed sum.
The stake was acquired from private equity houses Eden Ventures and Nordic Venture Partners in a move that could see Tesco become a leading player on the UK home entertainment market.
Blinkbox currently streams thousands of film titles to more than two million users each month. Like Lovefilm, the website offers a library of movies and TV shows to rent or buy.
Richard Brasher, Tesco's UK head, says of thye deal: "We can link physical purchase of a product to the building of digital collections in a new and seamless way. We want to allow them to decide how they access entertainment content and on which devices, whether it's on PC, TV or tablet. Working with the Blinkbox team and our content partners, we will bring these compelling propositions to life for our customers."
This announcement coincides with Clarke's unveiling of record annual profits of £3.54bn at the retail giant. Tesco's new CEO has also promised to introduce a new era of innovation at the corporation.
"It's a hugely exciting time," says Blinkbox chief executive Michael Cornish, a former senior executive at Channel 4. "This partnership represents another step forward, bringing the leading movie streaming service together with the UK's biggest retailer."