UK’s Second Biggest Grocery Chain Rebuffed In Acquisition Attempt

In U.K. retail intrigue news, the U.K.’s second largest supermarket group, Sainsbury’s, has been shot down in its takeover attempt for Argos and Homebase Owner Home Retail Group.  Sainsbury’s reportedly made the move in November 2015, but it was rejected. Sainsbury further noted the deal would have been “an attractive proposition” for customers and shareholders of both firms.

The rejection was predicated on the fact that the Sainsbury’s “undervalued Home Retail Group and its long-term prospects.”

Sainsbury is said to be considering its position and has cautioned they may be no formal offer coming. Under U.K. law the supermarket chain has until Feb. 2 to make such an offering.

Sainsbury’s interest in home retail stems from its ability to boost sales growth, improve delivery networks and maximally leverage their dual customer bases, according to a corporate release.

Home Retail Group’s shares closed up 41 percent on the news, while Sainsbury’s fell 5 percent.

Sainsbury’s is currently the second-largest British supermarket in the U.K., with a 16.7 percent share of the grocery market, according to Kantar Worldpanel. (Tesco holds the No. 1 spot.)