The supermarket group has until 5pm on 18 March to make a new offer for the company, almost four weeks from now.
Home Retail's shares closed up 12.96 per cent today at 173.5p, after a rival bidder swooped in ahead of today's original deadline for a Sainsbury's offer. Christo Weise-backed Steinhoff International made a higher cash offer of 175p-per-share on Friday - valuing the British business at £1.4bn.
Sainsbury's previous offer totalled £1.3bn, and Home Retail Group said earlier this month that it planned to recommend the offer.
"While the board of Home Retail Group continues to believe in the prospects for the standalone company, it recognises that the possible offer will provide an attractive opportunity for Home Retail Group shareholders to receive a full valuation for their shares, and, through their shareholding in the combined group, also to participate in the value created by the combined group from the transaction," the firm said in a statement at the time.
However, after announcing the extended deadline today, Home Retail Group said "there can be no certainty that Sainsbury's will proceed to make a firm offer" for the company.
Sainsbury's shares closed down 2.26 per cent at 255.2p today.