Tesco is to close its headquarters in Cheshunt and 43 unprofitable stores as part of a drastic plan to turnaround the supermarket retailer.

Dave Lewis (pictured), the new chief executive, also said that he intends to close Tesco’s defined benefit pension scheme – one of the most generous in the country – sell-off the analytics business behind Clubcard, scrap the dividend payout to shareholders, and slash 30pc of the retailer’s central costs.

Tesco has also poached Matt Davies, the highly-rated chief executive of Halfords, to become its new UK chief executive.

Tesco takes fight to discounters with price cuts on brands (Reuters)

Tesco to scrap dividend and close head office (Financial Times)

Tesco sparks supermarket price war (PA)

Tesco announces drastic changes as sales keep sliding (AOL Money)

Tesco closes stores as sales fall (PA)

Mr Lewis, who became known as “Drastic Dave” while working at Unilever, unveiled his strategy for Britain’s biggest retailer as it posted better than expected Christmas sales figures.

Tesco said that like-for-like sales fell by just 0.3pc during the six-weeks to January 3 and 2.9pc for the 19 weeks to January 3. This compared to a 5.4pc slump in the previous quarter and is a better performance than great rival J Sainsbury.

Mr Lewis described the changes he wanted to make to Tesco as “very difficult”.

He said: “I am very conscious that the consequences of these changes are significant for all stakeholders in our business but we are facing the reality of the situation.

“Our recent performance gives us confidence that when we pull together and put the customer first we can deliver the right results.”

Share price reacts positively

However, Mr Lewis said Tesco will close the offices and move head office to its site at Welwyn Garden City, also in Hertfordshire.

The Tesco boss, who joined in September, said the decision had required “soul-searching” but represented a “new chapter” for the company.

Mr Lewis said that a “significant proportion” of the 43 stores that will close are Tesco Express convenience shops.

Tesco is also scrapping plans to build 49 new stores, primarily large Tesco Extras, and Mr Lewis has written to community leaders to inform them of the company’s intentions.

The Tesco chief executive said his strategy had “wide-reaching implications for every stakeholder in our business” and were an “important first step to strengthen the balance sheet”.

He added: “This is a great business that has come under intense financial pressure.”

More stories:

Tesco takes fight to discounters with price cuts on brands (Reuters)

Tesco to scrap dividend and close head office (Financial Times)

Tesco sparks supermarket price war (PA)

Tesco announces drastic changes as sales keep sliding (AOL Money)

Tesco closes stores as sales fall (PA)

Tesco – company infromation:

Latest share price

Full company information