LONDON, Jan 14 (Reuters) - British retail takeover targetHome Retail reported a worse-then-expected 2.2 percentdrop in like-for-like sales at its biggest chain Argos, hoursafter its said it was in advanced talks to sell its Homebasechain for 340 million pounds.
Home Retail, which supermarket group Sainsbury's wants tobuy, said during December Argos suffered a 13 percent reductionin traditional walk-in sales, and a 10 percent increase indigital sales was not enough to compensate.
Analysts had expected like-for-like sales at Argos to riseby 0.3 percent in the 18 weeks to 2 Jan.
Home Retail said its benchmark profit before tax for thefinancial year ending February would be around the bottom of thecurrent range of market expectations of 92 million pounds ($132.66 million)to 118 million pounds.
Like-for-like sales at DIY chain Homebase rose 5 percent. Itsaid late on Wednesday it was close to selling Homebase toAustralia's Wesfarmers. ($1 = 0.6935 pounds) (Reporting by Paul Sandle; Editing by Sarah Young)