Sainsbury’s has confirmed that discussions over a potential sale of Argos have ended with Chinese giant JD.com.
Talks collapsed on Sunday, just one day after late-stage discussions between the two businesses were revealed.
At the time discussions were ongoing, Sainsbury’s said JD.com would bring “world-class retail, technology and logistics expertise” to accelerate Argos’ growth. Sainsbury’s bought Argos for £1.1bn in 2016.
However, a deal was soon off the table as Sainsbury’s said on Sunday: “JD.com has communicated that it would now only be prepared to engage on a materially revised set of terms and commitments, which are not in the best interests of Sainsbury’s shareholders, colleagues and broader stakeholders.
“Accordingly, Sainsbury’s confirms that it has now terminated discussions with JD.com.”
JD.com is one of China’s biggest retailers and has been trying to branch into the UK and European market. It acquired German electronics brand Ceconomy in June this year, while last year it walked away from talks to buy Currys.
In April, it also announced a trial for a UK grocery site, Joybuy, which is expected to be rolled out later this year.
A spokesperson for JD.com said: “We confirm we have been unable to agree on commercial terms with Sainsbury’s.”
Argos has almost 200 standalone stores and over 1,100 collection points, with most being in Sainsbury’s stores.
It has been struggling with wider headwinds and Sainsbury’s chief executive Simon Roberts said this year that the brand had “felt the impact” of lower customer spend and competitive trading conditions.
Any sale would be significantly lower than what Sainsbury’s paid, as the supermarket’s accounts valued Argos at £344m.
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