Tesco has hit back at claims that it allowed a town centre to become derelict to give it a stronger case for securing approval for a development of its own.

Reports earlier this week said Tesco secretly bought the town centre of Linwood in Renfrewshire through a front company and allowed it to deteriorate, then won approval to redevelop the crumbling 1960s shopping centre.

Tesco had links to Balmore Properties, which previously owned the town centre, but the local community was unaware of the connection, it was alleged.

It is common for supermarkets to use agents when buying land, but the Linwood case was said to be different because its decline was a key factor used to justify regeneration.

Sources close to Tesco said that the grocer had been involved with Linwood for several years, insisted it was upfront with the council and used the Tesco name on all planning documents.

The source added that it would be “suicidal” if a scheme was allowed to deteriorate on purpose because there was no guarantee that the grocer would win planning approval at the end of a lengthy process and therefore could be left with a scheme with no value.

Tesco claims to be one of only a few retailers investing in underprivileged areas. A spokeswoman said: “Linwood is just one example of a development where we are turning around a town centre rather than building on greenfield sites that not everyone can access.”

She added: “We have a strong track record of investing in some of the most deprived urban areas in Britain, regenerating communities for local people and creating jobs for the long-term unemployed.”