Sainsbury’s share price: Competition watchdog clears tie-up with Argos

J Sainsbury (LON:SBRY) has moved closer to completing its tie-up with Home Retail Group (LON:HOME), after the UK competition watchdog approved the £1.4-billion takeover. In a separate development, Sky News reported yesterday that the UK’s second-biggest supermarket was creating 900 jobs as it launches a same-day online delivery service trial.

Sainsbury’s share price has fallen into the red in London this morning, having shed 0.47 percent to 226.93p as of 10:18 BST. The shares are underperforming the broader London market, with the benchmark FTSE 100 index having climbed marginally into positive territory. The grocer’s shares have lost more than 16 percent of their value over the past year, and are down by some 11 percent in the year-to-date.

The Competition and Markets Authority (CMA) announced this morning that it had cleared Sainsbury’s acquisition of Home Retail, having decided not to refer the deal to a more detailed phase-two enquiry. Sainsbury’s is buying the Argos owner in an effort to broaden its product range as it looks to reduce its reliance on the UK grocery market which has been pressured by competition from German discounters Aldi and Lidl.
Sainsbury’s and Home Retail welcomed the CMA’s decision, noting that the tie-up remained subject on other conditions, including the approval of the Argos owner’s shareholders at a meeting on July 27.
In other Sainsbury’s news, Sky News reported last night that the company was recruiting 470 workers at its new online fulfilment centre in Bromley-by-Bow in east London to keep pace with online demand in the capital, with another 430 to be added by the end of the decade. The move comes with the FTSE 100 grocer launching a same-day online delivery service trial. The supermarket will start the service at three stores before rolling it out to 30 by Christmas.
The news comes after reports suggested earlier this month that Sainsbury’s was also trialling a one-hour home delivery service, similar to Amazon’s Prime Now, with online shopping turning into a battleground for supermarkets in their ongoing war.
As of 10:54 BST, Friday, 22 July, J Sainsbury plc share price is 227.00p.