J Sainsbury plc confirmed that it had entered talks to sell Argos to Chinese giant JD.com on Saturday – but they have already ended without agreement.
The listed supermarket group notified the London Stock Exchange this morning that the talks over Argos holding company Home Retail Group Limited – which it bought for £1.4 billion in 2016 – had been ‘terminated’.
It added that JD.com had ‘communicated that it would now only be prepared to engage on a materially revised set of terms and commitments which are not in the best interests of Sainsbury’s shareholders, colleagues and broader stakeholders’.
Argos is the UK’s second-largest general merchandise retailer, with the third most-visited retail website in the UK and over 1,100 collection points.
JD.com, listed on the Nasdaq exchange in the United States, is one of China’s largest retailers, with a market capitalisation of $49 billion.
It said: “We confirm we have been unable to agree commercial terms with Sainsbury’s.”
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Reports have suggested that Sainsbury’s chief executive Simon Roberts is trying to refocus the business on food. Many dedicated Argos stores have been closed, with branches instead opened inside supermarkets.
Sainsbury’s added in its statement: “Argos has traded in line with expectations over the summer, helped by good weather, with H1 sales and profitability stronger against a period last year when Q2 sales were boosted by clearance activity.”
Sainsbury’s expects to deliver retail underlying operating profit of around £1bn and cash flow of more than £500m in the financial year 2025/26.
JD.com previously considered a move for consumer electrics chain Currys, but opted against a bid.
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