In a move that retail watchers have been predicting since roughly the last ice age, Sainsbury's has agreed to sell Argos for £120m, ending a prolonged and frankly exhausting attempt to offload the catalogue retailer. The supermarket chain, which apparently wants to focus on its main food business, will now let someone else worry about the 'laminated book of dreams'.
Sainsbury's assures that it will be 'business as usual' for Argos customers, staff, and suppliers. Shoppers will see no change: Argos will still operate inside Sainsbury's stores, sell Habitat products, and offer Nectar points. So, if you were worried about losing your points, rest easy - your loyalty will continue to be rewarded, just under new management.
The buyer is Swift Partners, a company specifically created for this transaction, and it includes former Co-operative Group boss Richard Pennycook. Because nothing says 'retail revival' like a former co-op executive.
For those keeping score at home, there are 667 Argos shops across the UK, with 201 standalone stores and 466 tucked inside Sainsbury's. Plus, there are more than 450 collection points. Argos, founded in 1973, was the original click-and-collect, where customers browsed catalogues and placed orders, with products delivered to tills from warehouses. The catalogue, once described by comedian Bill Bailey as the 'laminated book of dreams', is no longer printed; the full range is now online, and in-store browsing is done via tablets. Progress, we suppose.
Sainsbury's has been trying to offload Argos for some time, seeing it as an underperforming brand. They bought Argos (and Habitat and other Home Retail Group brands) in 2016 for £1.4bn. They sold Argos Financial Services (the Argos card) for around £720m in 2024. And in September last year, talks to sell the rest to Chinese online retailer JD.com fell through. This time, it's Swift Partners to the rescue.
Sainsbury's chief executive Simon Robert said all of Argos's nearly 14,000 staff will transfer to Swift Partners. He also confirmed Argos will continue in Sainsbury's shops, Nectar will be used across both, and Sainsbury's will still sell Habitat products. Pennycook, for his part, believes 'strongly in Argos's future' and sees 'real opportunities to invest and build on its progress.' He even hinted at new standalone Argos shops and possibly the return of the print catalogue. Because nothing says 'digital-first' like a paper catalog.
The deal is expected to complete in February next year. Retail analyst Clive Black said he always questioned whether Argos was 'wholly aligned' with Sainsbury's grocery business, calling the sale attempt 'challenging and prolonged.' He noted Argos has been a 'suboptimal performer from a financial perspective.' Catherine Shuttleworth, another analyst, said Sainsbury's had been 'distracted' by its main supermarket arm, leaving Argos neglected. But under new ownership, she sees potential for Argos to be a 'really digital-first business' capable of giving a 'bloody nose' to online retail giants like Amazon. We'll see about that.
In Sainsbury's latest results for the first three months of this year, group-wide sales were up 3.1%, while Argos sales dipped 0.5%. Bally Auluk, national officer at Usdaw, the union representing Argos workers, said the announcement creates uncertainty but welcomed Swift's commitment to keeping the model of store-in-stores, standalone stores, and local fulfilment centres. So, there's that.