Argos owner confirms rejection of Sainsbury’s takeover bid

Supermarket group Sainsbury’s has confirmed that a bid to takeover Argos and Homebase owner Home Retail Group was made back in November 2015.

A cash and shares offer made by the supermarket chain was rejected by Home Retail Group, but Sainsbury’s is “still considering its position” on the deal, even though there is “no certainty this that this will result in a formal offer”.

Home Retail group has also confirmed rejecting a takeover bid, which it believed “undervalued Home Retail Group and its long-term prospects.”

In accordance with British takeover rules, Sainsbury’s now has until 5.00pm on February 2nd to make an official offer for Home Retail Group, or abandon the deal.

Sainsbury’s, which has been testing several Argos concessions in its stores over the past year, has called its possible takeover of Home Retail Group “an attractive proposition for the customers and shareholders of both companies.”

The supermarket group also claimed the two firms had “complementary products”.

Shares in Home Retail Group closed at just over 40%, which pushed its market value to over £1bn, whereas Sainsbury’s fell by 5%.

This announcement comes in the midst of an ongoing price war between the UK’s ‘big four’ supermarkets; Tesco, Sainsbury’s, Asda and Morrisons, as low budget food retailers, such as Aldi and Lidl, continue to dominate the UK grocery market.

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