WHSmith buys Marshall in $400m deal

200-year-old, WH Smith, a UK high street intrepid known for its stationery and books, intends to double its international business and strengthen its presence in the lucrative US airport shopping market with a deal to buy Las Vegas-based Marshall Retail Group for $400m. The transaction would double the size of WH Smith’s international travel business.  The proposed acquisition would be financed through debt and equity, with about £155m to be raised through an equity placement. A £200m term loan facility and expanded revolving credit facility from £140m to £200 would help.

Shares in the UK retailer rose almost 8 per cent in London trading yesterday to their highest level since January 2018.

WH Smith’s travel business accounts for about two-thirds of operating profit. A year ago the group paid £155m for InMotion, a US retailer of tech products.

Marshall Retail, which operates a variety of brands, has 170 stores in North America with 59 inside airports. It plans to open another 33 stores over the next five years. Sales from retail outlets in US airports are worth $3bn according to WH Smith.

WHSmith’s annual  results  reveals a pre-tax profit of £135m in the year to the end of August, including 20m of exceptional costs.