Deal wavers in Argos battle

SAINSBURY’s bid for Argos was on a knife-edge last night as executives were locked in conferences calls to decide the next move.

Bosses at Britain’s thirdlargest grocer were left reeling on Friday after a south African predator hijacked their £1.3bn plan to snap up the High street stalwart’s owner, Home Retail Group.

steinhoff, which owns Bensons For Beds and Harveys in the UK, launched a lastditch £1.4bn cash offer late on Friday.

sainsbury’s has until 5pm on Tuesday to match this offer, walk away from the deal, or request extra time. This is due to a ‘put-up or shut-up’ deadline imposed by the Takeover Panel which regulates bid situations.

sainsbury’s boss Mike Coupe spent the weekend at home in York, and after conference calls with other executives is likely to seek an extension to the Tuesday deadline as they crunch the numbers to work out whether to make a higher bid.

Home Retail Group had opened its books to sainsbury’s, which has been busy verifying whether certain assumptions it had made about Argos, ahead of its approach, were correct.

sources say sainsbury’s is still interested and believes the strategic rationale for a bid makes sense – but it will only do the deal at the right price for shareholders.

Its original cash and equity offer was 161p a share, a fair gap between the 175p cash offer from steinhoff.

However sainsbury’s share price has increased in recent days, increasing the equity value of its offer.

This means the value of its bid is now closer to 168p.