WH Smith to expand into US airports after £155m deal for accessories outlet In Motion
WH Smith's share price rose over five per cent this morning on news it will expand its brand into US airports after buying American travel accessories outlet In Motion.
The $198m (£155m) deal sees the British retailer take over 114 stores across some of the busiest airports in the US.
It doubles the size of WH Smith’s international travel business, and will provide a platform to launch and grow its airport format in North America, the company said.
The company’s travel business generates two-thirds of the group’s operating profits, including its stores in UK train stations and airports.
In Motion, which expects to turn over around $166m this calendar year, sells headphones, travel accessories, mobile power and cameras to its clientele in 43 US airports.
The company, which was founded in 1998, will continue to trade under its current brand and will keep its existing management team.
WH Smith chief executive Stephen Clarke said: "In Motion is a highly successful pure play travel retailer in the world's largest travel retail market. The acquisition of In Motion is an exciting value creation opportunity for the WH Smith Group and marks a major step in our international travel retail growth strategy. It doubles the size of our international travel business and provides us with attractive growth opportunities.
"The travel retail market in North America for digital accessories offers significant growth potential. As the market leader, recognised for its best-in-class customer service, In Motion is well positioned to take advantage of that potential.
“In addition, In Motion provides us with a scalable platform to launch the WH Smith airport format into the US, the world's largest travel retail market for news, books and convenience products.”
Earlier this month the company announced it would restructure its high street business, winding down non-core trials initiatives such as Cardmarket and WH Smith Local, which franchises to small newsagents.
The group’s revenue rose two per cent to £1.26bn in the financial year ending August, boosted by eight per cent growth in travel revenue, but held back by a three per cent drop on the high street.