WH Smith is in secret talks to sell its entire high street business in Britain more than 230 years after it opened its first shop in central London.
Sky News can exclusively reveal that the listed retail group, which has a market capitalisation of almost £1.5bn, has been in negotiations with a number of prospective buyers of the division for several weeks.
WH Smith will confirm the plan to the London Stock Exchange on Monday morning.
The company’s high street arm comprises roughly 500 stores, employing about 5,000 people across the country.
It is currently part of the same group as WH Smith’s faster-growing, more profitable travel retail business which operates from airports, train stations and hospitals.
The travel retail business comprises 600 shops in the UK, roughly half of a global operation numbering about 1,200 travel retail outlets.
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Run by Carl Cowling, chief executive, the disposal of its high street arm and repositioning as a pure-play travel retail company is likely to be welcomed by investors, one analyst said this weekend.
WH Smith’s high street division, which recorded flat operating profit of £32m last year, still largely sells greeting cards, books and stationery, while the travel arm has a wider offering of food and drink, and technology products.
The travel business now accounts for 75% of the company’s revenue, and 85% of profits, reflecting its higher margins.
It is growing particularly quickly in the US market.
The company’s retail business in hospitals is also growing rapidly, with 145 stores in 100 hospitals across the UK, and scope for openings in 200 further sites, it said in its last set of results in November.
News of the potential sale represents a watershed moment in the history of the British high street.
WHSmith’s first store was opened in 1792 by Henry Walton Smith and his wife Anna in Little Grosvenor Street, London.
I’m surprised the High Street stores have remained opened for this long. They were past their usefulness well over a decade ago and have been supported by their airport and hospital shops by ripping customers off.
Outdated. Expensive.
Smiths own a lot of their commercial property, so they can often hang on to a location when other stores on lease agreements might have closed up.
It’s been talked about for a while, when the vulture capital firms would eventually be in to squeeze all that real estate juice into billionaire pockets.