Tesco is merging with Booker in a £3.7 billion deal

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Tesco chief executive Dave Lewis leaves after attending the company's annual general meeting in London, Britain June 26, 2015. Price cuts and better service helped Tesco to win back shoppers in the first quarter of its financial year, Britain's biggest retailer said on Friday, suggesting new boss Lewis's turnaround plan is starting to bear fruit.

REUTERS/Neil Hall

Tesco CEO Dave Lewis.

LONDON - Supermarket Tesco on Friday announced a deal to merge with Booker, the UK's largest wholesale food retailer.

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Tesco says in a statement: "The Combined Group will be well placed to serve the large, established 'in home' food market as well as the faster growing 'out of home' food market."

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