Tesco's bid for the convenience store chain that runs the Day & Nite and One Stop outlets, has been cleared by Trade Secretary Patricia Hewitt.

On the advice of the Office of Fair Trading she decided not to refer the matter to the Competition Commission.

The £377m ($602m) bid had been criticised by rival supermarket chains and corner shop owners who feared that it would give Tesco too much power in the market.

Asian retailers had warned that their livelihoods would be threatened.

But Tesco argued that the bid would give it just 5% of the total convenience store market.

Problems for new stores

The UK's biggest supermarket chain announced in October that it was buying more than 1,200 shops from T&S Stores.

It said a number of them would be converted to the group's smaller Tesco Express format, creating about 1,400 jobs.

As well as One Stop and Day & Nite, T&S owner Dillons newsagents and Supercigs discount tobacconists.

Tesco said it planned to sell the Dillons and Supercigs brands.

Tesco, like its rivals, has found it increasingly difficult to get planning permission for new stores.

It has had to look elsewhere to expand and the convenience sector is an obvious choice because it is one of the fastest growing.