A bid by Sainsbury’s to buy Argos owner Home Retail Group has moved a step closer after one of the latter’s biggest shareholders backed the deal.
If it goes through, Sainsbury’s expects to start selling its Tu clothing brand through Argos stores.
Old Mutual, which owns a 3.6% stake in Home Retail Group, described the £1.3bn takeover deal as “fair”, according to City AM.
It said in a statement: “Following discussions with representatives of both parties, we have concluded that the terms of the agreed offer are fair, reflective of the future potential of the Argos business and the risk still associated with the transformation plan.”
Sainsbury’s has three weeks to carry out due diligence. The deadline for a firm offer for Home Retail Group is February 23.