Sainsbury’s has invested £130m to acquire 10 leasehold stores from Homebase.

The supermarket expects the transaction to complete in early September with the conversion of the sites into supermarkets to create approximately 1,000 new roles.

Sainsbury’s said the acquired stores are in “key” target locations that will grow the group’s supermarket coverage across England, Northern Ireland and Scotland. Once converted, the shop floor area of the stores will add a total of around 235,000 square feet to the group’s supermarket trading space.

At £130m, the gross investment value of the acquisition equates to the total capitalised cost of leases, acquisition premium and fit-out costs. Sainsbury’s suggested that its free cash flow targets will remain “unchanged”, as it continues to target a delivery of at least £500m on retail free cash flow in the 2024/25 financial year and at least £1.6bn retail free cash flow over the three years to 2026/27.

Sainsbury’s also said it would guarantee an interview for any Homebase colleagues placed at risk of redundancy because of the deal.

“We have the best combination of value and quality in the market and that's winning us customers from all our key competitors and driving consistent growth in volume market share,” said Sainsbury’s CEO, Simon Roberts. “We want to build on this momentum which is why we are growing our supermarket footprint.

“These new stores will showcase some of the best that Sainsbury’s supermarkets have to offer to even more communities around the country.”

Sainsbury’s said it plans to open the first of these stores next summer and aims to complete the conversion of all 10 sites by the end of 2025. Capital expenditure relating to acquisition and fit-out costs will be incurred across both the supermarket’s 2024/25 and 2025/26 financial years.

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