Sainsbury’s may increase its bid for Argos this week in an attempt to strengthen its position against South African rival Steinhoff.
It is understood that the supermarket chain is considering taking its inital£1.3bn offer to to £1.5bn.
The big four grocer’s potential new bid would put it in front of its rival who had entered the running with £1.4bn. A new proposal would likely be paid through a combination of shares and cash.
The bid comes just a day before Sainsbury’s announces trading results for the fourth quarter, which the city is predicting will reveal flat like-for-like figures.
“The changing circumstances and the ‘come on’ from HRG means Sainsbury’s could raise this offer to £1.5bn without breaking a sweat,” a source told the Mail on Sunday.
Both Sainsbury’s and Steinhoff have until 5pm Friday to submit their formal offers.