Sainsbury's wins backing of Home Retail Group board for Argos acquisition
Sainsbury's has won the backing of Argos-owner the Home Retail Group board for its acquisition of the company.
The supermarket is set to pay £1.4bn for the company, subject to the backing of shareholders, in a move that it believes will make it a multichannel leader in the UK retail market.
Argos is an Elite retailer in IRUK Top500 research, while Sainsbury's is in the Leading group.
Sainsbury's has previously said
that the move will give it the chance to build a "leading food and non-food retailer of choice for customers, building on the strong heritage of both the Sainsbury's and HRG businesses whose brands are renowned for trust, quality, value and customer service." Customers would benefit from the "right combination of location, range, speed and flexibility, across a wide range of products."
It envisages extending the model that sees 10 Argos digital format stores already located inside its supermarkets. It plans to move Argos stores into more of its supermarkets while filling in Sainsbury's, filling gaps in Argos' store network with new stores-within-a-store. Multichannel links between the two could include Argos click and collect in Sainsbury's stores.
Today Sainsbury's chairman David Tyler said the company was very pleased with the HRG recommendation. "The combined business will offer a multi-product, multichannel proposition, with fast delivery networks, which we believe will be very attractive to customers and which will create value to both sets of shareholders."
John Coombe, chairman of Home Retail Group, said: "Argos is both an icon of the British High Street and also a leader in the digital transformation of UK retailing. We are pleased that Sainsbury's has recognised our progress and our potential with its recommended acquisition of Home Retail Group plc. This is a testament to the vision and hard work of management and all of our colleagues."