Home Retail (LON:HOME), the subject of a high-profile takeover bid from Sainsbury’s, saw sales fall by more than expected in the 18 weeks to January.

The Group reported a 2.2 percent drop in like-for-like sales at its biggest chain Argos, which suffere a 13 percent reduction in traditional store sales in December, and a 10 percent increase in digital sales was not enough to make up the numbers. The Group announced that profit before tax for the 2015 financial year would be around the bottom of analysts’ expectations, which range from £92 million to £118 million.

Supermarket chain Sainsbury’s made a secret bid for Home Retail back in November, which has since been rejected, in an effort to expand its customer base by acquiring the Argos chain. Home Retail have also since announced that they are in talks to sell the Homebase arm of the company to an Australian home chain for £340 million. These disappointing results will no doubt be taken into consideration by both companies.

However, the news appears not to have affected investor sentiment, with Home Retail currently trading up 0.13 percent at 149.60 pence per share. (1021GMT)

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