Argos owner Home Retail Group agrees £340m sales of Homebase to Australian group Wesfarmers
PUBLISHED: 14:17 18 January 2016 | UPDATED: 14:17 18 January 2016
Argos owner Home Retail Group, which is being pursued by supermarket Sainsbury’s, has agreed to sell DIY chain Homebase to Australian conglomerate Wesfarmers for £340million.
The Australian supermarkets-to-industrials firm plans to rebrand Homebase’s 265 UK stores under the Bunnings fascia, its domestic DIY chain.
Home Retail said it expects to complete the deal, subject to shareholder approval, in the first three months of this year.
John Coombe, chairman of Home Retail, said: “We believe that this is the best deal for shareholders and for the business. Wesfarmers is an experienced and successful retailer with exciting plans to invest in and grow their presence in the UK through Homebase.”
Wesfarmers managing director Richard Goyder said: “The £38bn UK home improvement and garden market is a large and growing market with strong fundamentals.
“The opportunity to enter this attractive market through the acquisition of Homebase has been comprehensively researched and carefully considered by Wesfarmers and Bunnings.”
Sainsbury’s revealed earlier this month that it had made an initial approach for £1.3bn-rated Home Retail, which was rebuffed in November. The supermarket has until February 2 to make a formal offer for the group.
Homebase was originally founded by Sainsbury’s as a joint venture with Belgian retailer GB-Inno-BM in 1979 as Sainsbury’s Homebase. The supermarket sold the DIY business in 2000 for £969m and its current interst in Home Retail Group is thought to centre on the Argos business.