The deal will cover their relationship with global suppliers
Tesco and French retailer Carrefour are to enter into a long-term, strategic alliance.
They say it will enable them to improve the quality and choice of products available to customers at lower prices.
The deal will cover their relationship with global suppliers, the joint purchasing of own brand products and goods not for resale.
It will be governed by a three-year operational framework.
This agreement will also allow both companies to strengthen their relationships with suppliers.
While each company will continue to work with supplier partners at a local and national level.
It is thought the deal will exclude fresh food products.
The firms hope the plan will be formally agreed within the next two months.
Dave Lewis, Tesco Group chief executive, said: "I'm delighted to be entering into a strategic alliance with Carrefour.
"By working together and making the most of our collective product expertise and sourcing capability, we will be able to serve our customers even better, further improving choice, quality and value."
Chairman and CEO of Carrefour Group, Alexandre Bompard, said: "This strategic alliance between Carrefour and Tesco is a major agreement as it combines the purchasing expertise of two world leaders, complementary in their geographies, with common strategies.
"This agreement is a great opportunity to develop our two brands at the service of our customers.
"This international alliance further strengthens Carrefour allowing it to reach a key milestone in the implementation of its strategy."
The financial terms of the alliance were not disclosed.
Tesco has over 6,800 shops around the world, with 140 stores across Ireland, and employs some 440,000 people globally.
While Carrefour has more than 12,000 stores in over 30 countries.