Home Retail shares rise on Asda takeover talk

Walmart-owned supermarket is apparently considering a bid for Home Retail.

Argos and Homebase buy could help Asda compete with Tesco

Investors went shopping for Home Retail shares this morning following reports that supermarket chain Asda is planning a bid for the company behind Argos and Homebase.

Shares in Home Retail jumped 5% in early trading to 294.5p, making it the biggest gainer on the main London market.

Yesterday the Mail on Sunday reported that Asda, which is part of US corporation Walmart, is planning a major acquisition in an effort to close the gap with Tesco. Home Retail is apparently one of the companies Asda has looked at.

Shore Capital analyst, Kate Calvert, said this morning that a deal could make sense for Asda, if it could acquire Home Retail for no more than 370p, because:

Home Retail is the market leader in most of its product categories and its market-leading, multi-channel business model would make it an attractive business, we believe. Its customer base also has a similar demographic profile to Asda.

Source: Guardian.co.uk
www.guardian.co.uk/business/marketforceslive/2010/apr/12/homeretailgroup-asda-takeover?INTCMP=ILCNETTXT3487