Sainsbury’s Hit Back with Cheapest Loans Amidst Argos Takeover Negotiations
The Sainsbury’s Loans were the cheapest that you could find on the market across the 2015 year. As was reported in early 2016, M&S swooped in with 3.3% APR to take the #1 spot, followed closely by their owner (HSBC) who charged just a few extra pence. The M&S leading rate has now been pulled and they charge 3.5%. HSBC haven’t however budged from 3.3%. Sainsbury’s now match this, but they get the bragging rights from going £0.02 cheaper. Their £10,000 12 month loans calculate as £176.96 with Nectar or £182.24 without. HSBC’S price is £176.98. Obtaining a Nectar card is simple. You simply ask for one at a checkout and validate it online.
The loan rate drop has not received any press. Instead, all of the talk has surrounded their proposed purchase of the Home Retail Group. This is for Argos since Homebase was recently sold to Australia’s Wesfarmers. It came as quite a surprise when their interest was announced. An initial approach in November 2015 was rejected. More recently a proposal of £1.3 billion was put forward, but then came Steinhoff International at £1.44 billion. South Africa’s Steinhoff International made their name in the UK through the acquisitions of Bensons for Beds and Harveys Furniture. They and the supermarket giant must now meet the deadline of this coming Friday at 5pm to make a firm offer or simply walk away.
It has been suggested that a bid of £1.5 billion may be required to seal the deal. J Sainsbury Plc’s CEO Mike Coupe has a desire to acquire to serve customers: “Wherever and whenever they want to shop”. Their delivery network is of great significance through the plan to build a food and non-food retailer of choice for customers. Some have seen the deal as a huge gamble. Argos have had a rocky few years and the supermarket chain themselves have faced their own troubles. This purchase could spell disaster or perhaps we may see a potential challenger to Tesco’s retail crown. Let’s just see if the deal goes ahead. Steinhoff will have their own plan of attack.
Update: £1.4 billion offer made. Steinhoff withdrew from the takeover battle.