Feb 4, 2016
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Home Retail Group shareholder supports Sainsbury's offer

Feb 4, 2016

British supermarket chain Sainsbury's acquisition of Home Retail Group Plc, which consists of the Homebase, Argos and Habitat brands, has moved a step closer to completion.

Old Mutual, which is part of Old Mutual Wealth and Home Retail Group's third largest shareholder, has announced that it regards the offer for Home Retail Group plc by J Sainsbury plc to be fair, taking into account the acceleration of the Argos transformation plan within Sainsbury's.

Last year Argos and Sainsbury's struck a deal that lets Argos open stores within existing Sainsbury's stores, as Sainsbury's found it has under-utilised shop space.

Sainsbury's has now made an offer to take over Home Retail Group for 161.3p a share (£1.3bn total.) Old Mutual said: "The agreed terms are below the 200 pence per share level which appeared in remarks to the media by Old Mutual Global Investors after the initial approach by J Sainsbury plc.  Since that time there has been the agreed disposal of Homebase by Home Retail, their update on Christmas trading and more detail on the opportunities for Home Retail within the Sainsbury group. "

Old Mutual 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." Its investors currently holds 3.6% of Home Retail Group plc voting rights across the business, or 29,420,408 nominal shares.

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