Sainsbury’s shifts focus back to its core grocery business
Sainsbury’s has agreed to sell Argos to Swift Partners for £120 million as the supermarket group moves forward with plans to focus more heavily on its main food retail operations.
The deal ends a lengthy effort by Sainsbury’s to find a buyer for Argos, which has been viewed as a weaker-performing division within the wider group. Despite the ownership change, customers are not expected to see immediate changes, with Argos continuing to operate in Sainsbury’s stores, offer Habitat products, and support Nectar loyalty points.
Swift Partners to take control of Argos
Swift Partners, a newly created investment company, will acquire Argos and includes Richard Pennycook, the former chief executive of Co-operative Group, among its members.
Argos currently operates 667 stores across the UK, including 201 standalone locations and 466 stores located within Sainsbury’s supermarkets. The retailer also has more than 450 collection points across the country.
As part of the transaction, all of Argos’s nearly 14,000 employees will transfer to Swift Partners once the deal is completed. The acquisition is expected to close in February next year.
Argos operations will continue as normal
Sainsbury’s confirmed that Argos will continue operating within its supermarkets after the sale. Customers will still be able to collect Argos orders from Sainsbury’s locations, use Nectar points across both businesses, and purchase Habitat products through the brand.
Richard Pennycook said Swift Partners believes strongly in Argos’s future and sees opportunities to invest in the business and build on its progress. He also suggested that there could be potential for opening new standalone Argos stores and did not rule out bringing back the company’s famous printed catalogue.
From catalogue retailer to digital-first business
Founded in 1973, Argos became one of the UK’s best-known retailers through its catalogue-based shopping model. Customers would browse products in printed catalogues, place orders in stores, and collect items delivered from connected warehouses.
The company’s catalogue was once considered a cultural symbol in Britain, famously described by comedian Bill Bailey as the “laminated book of dreams.” However, Argos eventually moved away from printed catalogues, with its full product range now available online and in-store through digital browsing tools.
Sainsbury’s long effort to sell Argos
Sainsbury’s acquired Argos, along with Habitat and other Home Retail Group brands, in 2016 for £1.4 billion. The supermarket group later sold Argos Financial Services, which operates the Argos credit card, for around £720 million in 2024.
The company had been attempting to sell the remaining Argos business for some time. A potential deal with Chinese online retailer JD.com collapsed in September last year after negotiations failed.
Analysts see opportunities under new ownership
Retail expert Catherine Shuttleworth said Argos had become a distraction from Sainsbury’s core grocery operations, but believes new ownership could allow the brand to develop into a stronger digital-focused retailer.
She highlighted Argos’s user-friendly app and its click-and-collect model, which allows customers to order products online and collect them from stores on the same day. According to Shuttleworth, this gives Argos the ability to compete effectively with major online retailers such as Amazon.
Retail analyst Clive Black said he had long questioned whether Argos was fully aligned with Sainsbury’s supermarket strategy. He described the sale process as challenging and prolonged, while also noting that Argos had underperformed financially.
In Sainsbury’s latest financial results, group sales increased by 3.1% during the first three months of the year, while Argos sales declined by 0.5%.
Union welcomes commitment to maintain Argos model
Bally Auluk, national officer at Usdaw, the union representing Argos workers, said the announcement would create uncertainty for employees but welcomed Swift Partners’ commitment to maintaining the current business model.
The union highlighted the importance of preserving Argos’s combination of standalone stores, stores within Sainsbury’s locations, and local fulfilment centres.
