Wed, 03 Feb 2016 | BUSINESS SALE
J Sainsbury's can celebrate now that it has secured Argos, its object of desire, and will tie up with Home Retail after all.
The £1.3 billion deal is the result of months of ongoing talks and offers, and will see Sainsbury's become the new owner of the Home Retail Group. The newly joined pair will be a greater force to be reckoned with in the tough retail marketplace, and united will have a stronger foothold against online sellers such as the likes of Amazon, which has also recently entered the food market, and discount retailers such as Aldi and Lidl.
According to Mike Coup, Sainsbury's chief executive, the move creates a non-food retailer with sales exceeding that of Amazon and John Lewis in the UK.
The deal has been structured in an unusual way – as reported by The Financial Times. Sainsbury's own finance arm will raise £440 million in cash and will be financed using customer deposits at Sainsbury's Bank. Another £100 million will be plugged in from the parent group to meet the regulatory requirements, and the remaining £500 million is to be sourced from savings.
Argos, some of whose concessions will slot neatly into excess spare space in Sainsbury's stores, suffered low sales over the Christmas period.
“You are adding a very very challenged business to a very challenged business,” Tony Shiret of Haitong securities warned.
Sainsbury's puts forward £1.3bn offer for Argos owner
Residential Care Home features 39 bedrooms is up for sale. The home had average occupancy of 83.9 per cent in the year to July 2022. Offers invited.
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