Sainsbury's makes formal £1.4 billion for Argos owner Home RetailComments Off on Sainsbury's makes formal £1.4 billion for Argos owner Home Retail
Sainsbury’s has made a formal £1.4 billion bid for Argos owner Home Retail Group after becoming the last man standing in the race for the retailer.
With just 30 minutes to go until the 5pm deadline to submit a formal bid expired the supermarket announced the cash and shares offer for the company.
Its rival in the race, South Africa’s Steinhoff, earlier pulled out of the running, instead making a $975 million (£672.7 million) takeover offer for French electrical goods retailer Darty.
Sainsbury’s offer values each Home Retail share at 173.2p and was on the same terms as an earlier, though not formal, proposal.
Home Retail shares closed down 9% at 163.2p. Sainsbury’s were down almost 3% at 273.2p.
Sainsbury’s has not received the Home Retail board’s recommendation of its offer but said it will seek it.
Following due diligence, Sainsbury’s now expects a higher level of synergies from the deal.
Synergies will total not less than £160 million in the third full year after completion. Its earlier prediction was for £120 million pounds.
Additional reporting by Reuters