WHSmith high street rival 'considering swooping' to buy 500 stores
The HMV owner is in talks to snap up WHSmith high street stores. It is understood that advisers working for WHSmith have been in discussions with Doug Putman, the Canadian entrepreneur who rescued HMV from bankruptcy in 2019.
The retail group, which has branches in Birmingham, has been in negotiations with several prospective buyers of the high street division for several weeks. Last October Mr Putman told The Sun newspaper in the UK that he would "love to buy more businesses in the UK".
The company confirmed the prospective sale over the weekend, saying: “WH Smith confirms that it is exploring potential strategic options for this profitable and cash generative part of the group, including a possible sale … There can be no certainty that any agreement will be reached, and further updates will be provided as and when appropriate.”
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Russ Mould at AJ Bell said; "Exiting makes strategic sense and there have been plenty of clues it would happen one day soon. The travel arm is where most of the profits are made. It makes sense to sharpen the focus on what a company does best by offloading less important interests such as the high street operations."
It is likely that any buyer would not keep all of WH Smith's 500 stores open for very long, the Sun newspaper reports. Commenting on the prospective sale, Kien Tan, a senior retail adviser at PwC said: “The same formula that works in travel stores is no longer sufficient on high streets, where many of its products are available at other retailers or online.
“That doesn’t mean that the high street stores don’t have a future, but they probably will look very different – different products, perhaps incorporating hospitality or other services to give people a reason to visit. That doesn’t mean that WH Smith needs to disappear, but it might have a different brand name above the door to reflect the different customer proposition.”