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.
Bankers at Greenhill have been appointed to run the sale process for the high street business, with a deal expected in the coming months.
The identities of the likely buyers were unclear on Saturday.
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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.
The company opened the first ever travel retail store in Euston station in 1848.
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There have been questions about the future of WH Smith’s high street division for many years amid carnage elsewhere in the sector, with the likes of BHS, Debenhams and Comet all ceasing to trade from physical stores in the last 15 years.
This week, it emerged that roughly 15 WH Smith shops would be closed this year – part of an annual rationalisation of its store estate.
In 2006, the company’s news distribution arm, now known as Smiths News, was demerged into a separate London-listed company.
On Friday, shares in WH Smith closed at 1148p, having declined by about 5% over the last 12 months.
In a statement following Sky News’ report of its plans, WH Smith issued a statement confirming it was “exploring potential strategic options for this profitable and cash generative part of the Group, including a possible sale”.
“Over the past decade, WH Smith has become a focused global travel retailer,” the statement said.
“The Group’s Travel business has over 1,200 stores across 32 countries, and three-quarters of the Group’s revenue and 85% of its trading profit comes from the Travel business.
“There can be no certainty that any agreement will be reached, and further updates will be provided as and when appropriate.”
