Sainsbury’s has agreed to sell Argos for at least £120m, ending its ownership of the general merchandise retailer a decade after buying it for £1.1bn.
The supermarket group said the sale was part of chief executive Simon Roberts’ strategy to focus the business on its core grocery operations.
Argos will be bought by a consortium called Swift Partners, led by former Co-operative Group chief executive Richard Pennycook, former Morrisons executive Trevor Strain and retail investment specialist Matt Truman.
The deal is expected to be completed in February 2027.
Sainsbury’s shares rose by about 3.5% in early trading following the announcement.
Argos operates 667 stores across the UK, including 466 located inside Sainsbury’s supermarkets and 201 standalone high-street outlets. It sells a wide range of products including electrical goods, furniture and toys.
Mr Roberts said Sainsbury’s had spent the past six years concentrating on its food business.
“Over the last six years we've been totally focused on resetting food at the heart of the Sainsbury's brand,” he told reporters.
Asked whether the decision to buy Argos had been a mistake, Mr Roberts said the disposal was the latest step in reshaping the company.
Sainsbury’s also sold its banking business and ATM operations in 2024 and 2025 as it sought to streamline the group.
New owners plan expansion
The new owners said they intended to invest in Argos and expand its store network.
Mr Pennycook said there was scope for new outlets both inside future Sainsbury’s supermarkets and in standalone locations where the supermarket does not currently operate.
The deal will include a commercial partnership between Sainsbury’s and Argos covering stores, collection points, the Habitat homewares brand and loyalty cards.
Sainsbury’s expects to receive at least £120m in cash from the sale. At least £70m will be paid when the transaction is completed, with the remainder due over the following three years.
The supermarket said the disposal was expected to have a broadly neutral effect on profit and a small positive impact on underlying earnings per share.
However, Sainsbury’s expects to record a £350m non-cash impairment charge as a result of the transaction.
Argos, which became fully digital in 2020 after decades of operating through printed catalogues, has faced increasing competition from online retailers such as Amazon.
The wider general merchandise sector has struggled in the UK as consumers have increasingly shifted towards online shopping.
Sainsbury’s acquired Argos in 2016 as part of an effort to expand beyond food retail. The sale marks a significant reversal of that strategy as the company places greater emphasis on its position as Britain’s second-largest supermarket chain behind Tesco.
Sainsbury’s currently holds about 15% of the UK grocery market, its strongest share in roughly a decade. Photo by Mtaylor848, Wikimedia commons.
