WH Smith high street arm sold to Hobbycraft owner in £76m deal
Sky News revealed in January how a sales process was under way for the arm, which employs roughly 5,000 people and has 480 stores.
Modella Capital won the final stage of the auction process in a run off against Alteri investors – both specialists in turning around troubled retailers.
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The deal will see the WH Smith name erased from town centres to become TGJones.
The sale allows the WH Smith business to focus fully on its lucrative travel retail arm.
That has around 1,200 stores, based mainly at airports and railway stations, in 32 countries globally and accounts for 85% of group profits.
Chief executive Carl Cowling said: “Given our rapid international growth, now is the right time for a new owner to take the High Street business forward and for the WH Smith leadership team to focus exclusively on our Travel business”.
There was no word on what the new owners may do to bolster profitability, with a question mark firmly hanging over employment and the store estate – often the subject of criticism over a perceived lack of investment.
WH Smith’s statement said: “All stores, colleagues, assets and liabilities of the High Street business will move under Modella Capital’s ownership as part of the Transaction.
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“Under this new ownership, the business will be led by Sean Toal, currently CEO of the High Street business. The High Street business will operate for a short transitional period under the WHSmith brand whilst the business rebrands as TGJones.”
The sale to Modella represents an enterprise value of £76m on a cash and debt-free basis.
