Tesco has confirmed that it will not be going ahead with its planned 300,400 sq ft scheme in Knowsley, which included a proposed 140,000 sq ft store and 90 retail units.
An announcement from the supermarket operator on Thursday 8 January said that Tesco would be transforming its business model due to a "disappointing performance". The company said that it would not proceed with 49 planned developments across the UK, including the scheme at Kirkby, and that it would close 43 stores nationwide.
Plans for the store and accompanying retail units were approved in 2011 as part of a £200m regeneration of Kirkby town centre, with Tesco funding £1m enhancements to the market and improvements to council buildings.
A statement from Knowsley Council confirmed that Tesco would complete the ongoing work to clear the site of the empty houses on Cherryfield Drive so that the plot would be available for future development.
The council said: "Knowsley Council will now focus on finding another private sector partner to step in and complete the retail aspect of the programme.
"Up until this morning [Thursday 8 January], we were continuing to work closely with Tesco on all aspects of the overall regeneration programme and we had no reason to believe at any stage that any part of the scheme was in any doubt.
"As recently as October 2014, Tesco carried out a review of its current schemes and considered Kirkby to be a viable development.
"The Council is now actively pursuing all options available to deliver the retail development as part of the wider regeneration programme."
Dave Lewis, chief executive of Tesco, said in a letter to the council: "In recent weeks we have had to face up to some very tough decisions which affect many hard-working people. I don't do that lightly and so it is with a heavy heart that I am announcing today that we are unable to proceed with 49 new planned store developments across the country, including our planned store in Kirkby.
"I am very sorry that we have not been able to deliver the investment that we intended and had promised to the community. I know this news will be a real disappointment to many people in your community and we are extremely grateful for the support we have received for our plans."
Talks with Tesco on the site were first announced in 2006, with initial plans to include a stadium for Everton FC which were shelved in 2009.