Sainsbury’s has agreed to sell Argos for at least £120mn to Swift Partners, a newly formed company led by veteran UK retail executives.

The deal comes a decade after Sainsbury’s bought Argos for £1.4bn and after a failed attempt last year to offload the chain to Chinese e‑commerce giant JD.com. Argos has long been a drag on the supermarket group’s performance.

Chief executive Simon Roberts called the transaction a “step forward in our strategy,” saying it lets the group focus all resources on its core food business. Sainsbury’s will record a non‑cash £350mn hit, but the impact on underlying operating profit is expected to be broadly neutral.

Swift Partners is headed by Richard Pennycook, former Co‑op and Morrisons executive; Trevor Strain, ex‑Morrisons operating chief; and Matt Truman, executive chair of True Capital. Sainsbury’s shares rose 3.5% in early trading on Friday.