Sainsbury's said it expected cash proceeds of at least £120m from the agreement with Swift Partners, whose shareholders include Richard Pennycook - a former chief executive of the Co-op Group. It had paid £1.4bn for the chain back in 2016.

Sainsbury's said that Argos would continue to trade through its existing channels, "with long-term commercial agreements covering Argos stores in Sainsbury's, Nectar, Nectar360 and Habitat ensuring continuity for customers, colleagues and suppliers".

Simon Roberts, Sainsbury's chief executive, said of the decision: "Sainsbury's has transformed Argos into a leading multichannel retailer with millions of customers and thousands of talented colleagues.