Business
Sale of UK High Street business
Sale of UK High Street business.
About this update from Wh Smith Plc
[{"type":"text","content":"\n\n \nTHIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION\n \n \nWH Smith PLC\n \nThe global travel retailer\n \n28 March 2025\n \n \nWHSmith sells UK High Street business\nto focus on higher growth travel retail markets\n \nTransaction Highlights:\n \n· WH Smith PLC (\"WHSmith\" or \"the Group\") has agreed the sale of its UK High Street1 business to Modella Capital (the \"Transaction\"), creating a pure play global travel retailer\n· Consideration represents an enterprise value of £76m on a cash and debt-free basis\n· Gross cash proceeds of £52m, with anticipated net cash proceeds of c.£25m when adjusted for transaction and separation costs, to be deployed in-line with the Group's capital allocation policy\n· WHSmith brand is not included in the sale. The Group's Travel divisions will continue to trade under the WHSmith brand across 32 countries and including at major airport locations, hospitals and rail stations in the UK\n· Transaction is consistent with the Group's strategic focus and will allow management to concentrate on capturing the substantial growth opportunities in its key travel markets with a clear focus on driving shareholder value\n· Over time, the Group has increased its focus on Travel, with 75% of the Group's revenue and 85% of its trading profit coming from its Travel business in the last financial year\n· By removing exposure to the UK High Street and with c.50% of the business now international, the Transaction will enhance the Group's financial profile:\no Enhancing revenue growth\no Enhancing PBT margin\no Enhancing rate of growth in trading profit and EPS\no Maintains the Group's current attractive free cash flow generation\n· The Group is trading in line with market expectations\n \nBackground and strategic rationale\n \nOver the last decade, WHSmith has become a leading global travel retailer with over 1,200 Travel stores across 32 countries. While profitable and cash generative, the UK High Street business has become an increasingly smaller part of the WHSmith Group. In the financial year ended 31 August 2024, 75% of the Group's revenue and 85% of its trading profit came from its Travel business. As the...