A man has killed and beheaded a British woman in a supermarket on the Spanish island of Tenerife.

The suspect, a 28-year-old unemployed Bulgarian man, attacked the unnamed 60-year-old woman with a knife and then fled into the street with the severed head in his hands, according to eyewitnesses. Police have identified the alleged killer as Deyan Valentinov D., but have not released a surname.

Colin Kirby, a reporter for Tenerife Magazine, explained what he had seen as he walked past the shop, in Los Cristianos, Arona, which is situated on the southern point of the island at around 10.30 am.

He said he had spoken to an English couple who were in the shop at around 10.30am when the incident happened.

"They said this guy just walked in, pulled a big knife and started stabbing at her."

He added: "I didn't see the attack but I saw the guy. I was walking past the commercial centre and I saw a small group of people outside. There was a guy from the medical centre going down the ramp and I thought perhaps someone had fainted.

"I heard people shouting and screaming and making a commotion. A Hispanic looking guy, very scruffy, was walking behind me muttering to himself, carrying what I thought was a joke head by the hair, with blood.

"It made me think of Clash of The Titans, gorgons. I thought … it's a joke'. The man was in his late 20s … He was a bit dishevelled, unwashed, he was wearing a jumper and trousers, when everyone else is wearing shorts. Even at 10.30 in the morning, it's boiling."

Kirby said that the man ran off as security guards and others chased after him.

"Security guards rushed from the shop where he'd been, chased him across the road and by this time he was pinned to the floor. By this time he was empty-handed and was on the other side of the road."

"The security and the police had to hold people off – they were queueing up – they were trying basically to kick the hell out of the guy."

Los Cristianos has a large expat British community.

A witness told the radio broadcaster Cadena Ser that he saw the man drop the head on the pavement after coming out of the shop.

"I parked my car and saw a man running out with something bloody in his hands and a security guard chasing him. He threw it to the ground. It almost hit me.

"What he had been carrying was a woman's head."

Araceli Perez, 33, who works for Ocean Properties, said the victim was British but of Chinese ancestry. "[The killer] was running away with her head in his hands," she said. Tenerife media were saying the killer had previous convictions for violence, she added.

The Foreign Office said that not all the woman's family had been informed and they could not comment other than to confirm that she had died. "We are aware that a British national has died in Tenerife," it said.

José Alberto González, the mayor, said the attack did not appear to be premeditated and had been recorded on the supermarket's security cameras. A regional interior ministry delegate, Dominica Fernández, said the suspect was believed to have entered the shop and stolen a knife, which he then used to behead the woman. The attack appeared to be random.

Police are investigating to see if the victim and the killer knew one another.