WH Smith has sold its 480-outlet bookstore chain, for £76 million (about $98 million), to private equity firm Modella Capital, which has renamed the business TGJones. The WH Smith brand is not included in the sale—meaning that after 250 years, the WH Smith name will no longer be associated with selling books on high streets across the U.K. Instead, the brand will be used on WH Smith’s travel stores, which it operates across 32 countries.
In January, WH Smith announced that it was seeking a buyer for its bookstore business, in order to allow it to concentrate on its more profitable global travel retail business. The company’s travel business has expanded in recent years, and in the fiscal year ended August 31, 20204, generated revenue of £1.47 billion, with profits of £189 million. Meanwhile, WH Smith’s high street division, upon which it built its name, has stagnated: 75% of the group’s revenue of late, and 85% of its trading profit, came from the former, not the latter.
“The high street business is profitable and cash generative,” according to the sale statement: “The business currently employs about 5,000 colleagues across 480 stores in primary locations across the U.K. and from its Swindon-based support center.”
With the sale, the announcement continued, all stores, colleagues, assets, and liabilities of the high street business will move under the ownership of Modella, which describes itself as “a specialist retail and consumer investment boutique” and owns the hobby and craft retail chain Hobbycraft. The business will be led by Sean Toal, current CEO of WH Smith High Street. The bookstores will operate for a short transitional period under the current name while rebranding itself as TGJones.
“As we continue to deliver on our strategic ambition to become the leading global travel retailer, this is a pivotal moment for WH Smith as we become a business exclusively focused on travel,” said WH Smith group chief executive Carl Cowling, in a statement. He added that, while bookstores are a "good business, 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."
A version of this story originally ran in the U.K. trade publication BookBrunch.
