- Coles supermarket owner Wesfarmers in “advanced” talks to buy Homebase
- Deal being finalised after discussions started in September
- Home Retail boss John Walden says deal represents “good value for shareholders”
Home Retail Group has revealed it is in “advanced discussions” to sell its Homebase business to Australian retailer Wesfarmers for £340m.
The grocer is shaping up for a formal bid for the Argos owner after revealing an initial bid approach was rejected in November.
Home Retail said the deal with Wesfarmers is being finalised after discussions began with the Australian firm in September.
However, it noted: “There can be no certainty that a transaction will be agreed.”
Perth-headquartered Wesfarmers is one of Australia’s largest retailer groups, whose subsidiaries include the supermarket chain Coles.
As part of the deal Wesfarmers would acquire the entire Homebase business, including all it stores and dedicated distribution centres.
Product brands, such as Habitat, Schrieber and Hygena will be excluded from the sale, but licensed for use by Homebase for one year, the statement said.
Home Retail Group’s chief executive, John Walden, said: “This deal would represent good value for shareholders and a growth opportunity for the Homebase business and its colleagues.
“The sale would allow the group to focus on Argos and its Transformation Plan, with an improved balance sheet and financial position, which I believe represents an even greater opportunity for building long-term shareholder value.”