Home Retail Group turns down Sainsbury’s offer

The British supermarket operator J Sainsbury has made a bid to acquire the Home Retail Group (HRG), which also owns the Homebase DIY chain.  Sainsbury's already made an offer in November 2015 which was turned down by the HRG board, as the company recently reported. The Sainsbury board said in its statement that they hope to "create a food and non-food retailer of choice for customers" and "deliver profitable sales growth". Specific reference is made to "a strong presence across food and grocery, clothing, homewares, toys, stationery, electricals, furniture and other general merchandise". Analysts from the bank and industry sector noticed that there was no mention of home improvement or do-it-yourself and even the name Homebase did not feature.
Sainsbury's is the former owner of Homebase. The supermarket operator sold its majority stake in Homebase to the private equity group Permira in 2000. Two years later, when the DIY chain was sold to HRG's predecessor company, Great Universal Stores (GUS) and integrated in its subsidiary Argos Retail Group, Sainsbury's then sold the remaining shares. Sainsbury's made a total of around GBP one bn from the sale of Homebase. The stock market value of the whole Home Retail Group is currently estimated at GBP 1.1 bn, a share price rise following Sainsbury's statement.