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LONDON, Feb 3 (Reuters) - Old Mutual Global Investors, which has a 3.6 percent stake in Argos-owner HomeRetail, said on Wednesday it regards Sainsbury's cashand shares proposal for its holding to be fair.
British supermarket Sainsbury's has bid 1.3 billionpounds ($1.9 billion) to take over Home Retail, valuingeach share at 161.3 pence[ID:nL8N15H0ZG.
The investment group, one of Home Retail's largestshareholders, noted the agreed terms were below the 200 penceper share level which appeared in remarks it gave to the mediaafter the initial approach by Sainsbury's to Home Retail becamepublic knowledge on Jan. 5.
But since then Home Retail has agreed the disposal of itsHomebase business and published its Christmas trading update,while more detail on the opportunities for Home Retail withinSainsbury's has been released.
"Following discussions with representatives of both parties,we have concluded that the terms of the agreed offer are fair,reflective of the future potential of the Argos business and therisk still associated with the transformation plan," Old Mutualsaid.
Shares in Home Retail were down 0.2 percent at 152.8 penceat 1043 GMT, while shares in Sainsbury's were down 1.2 percentat 247.6 pence. ($1 = 0.6918 pounds) (Reporting by James Davey Editing by Jeremy Gaunt.)
