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Path cleared for Sainsbury's Argos deal

The path is suddenly clear for Sainsbury to make its final move on Home Retail.
March 21, 2016

South African retail group Steinhoff has walked away from a possible takeover of Argos owner Home Retail (HOME). This has left the path clear for supermarket chain J Sainsbury (SBRY) which didn't waste any time in making a second set of deal terms available to shareholders.

IC TIP: Buy at 278p

Not much has changed from the original proposal, although Sainsbury's bosses reckon they can squeeze another £40m in cost synergies from the deal by the third year of ownership. The offer price - inclusive of special dividends - represents 170p per Home Retail share, a considerable premium to the pre-Christmas share price.