Tesco buys 80 per cent of Blinkbox

Philip Clarke, the new chief executive of Tesco, has made his first acquisition, buying Blinkbox, the UK movie streaming service provider, for an undisclosed sum.

Tesco has bought an 80 per cent stake in Blinkbox from Eden Ventures and Nordic Venture Partners in a move that will see the grocery giant compete head to head with Amazon's Lovefilm and BSkyB in the home entertainment market.

Blinkbox, based in London, streams thousands of titles over the web to more than two million users each month. Its website offers 9,000 movies and TV shows to rent or buy. Alongside unveiling record annual profits of £3.54bn, Mr Clarke yesterday vowed to introduce more innovation into Tesco's business and to ramp up its multi-channel wherever it trades.

Richard Brasher, the UK chief executive of Tesco, said, "Whether customers want to own the DVD, download a digital movie, stream a rental or all three, Tesco is committed to giving customers choice."