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WH Smith to buy US-based Marshall Retail for $400m

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today Oct 17, 2019
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UK high street and travel retail newsagent WH Smith delivered a surprise on Thursday with news that it’s buying US-based travel retail specialist Marshall Retail Group. The two have signed an agreement for the British firm to acquire the fast-growing American business for $400 million (around £312 million).


Marshall Retail Group



The company said it’s a “compelling opportunity to accelerate the growth of [its] International Travel business in the $3.2 billion US airport travel retail market.”

While Marshall sells many of the same goods as WH Smith, such as magazines, books and confectionery, its big focus is retail as an experience and it also offers fashion, beauty and other lifestyle products. Brands it sells include Joseph Ribkoff, Bella Scarpa, Baggallini, Tumi and Kiehl’s in a store estate that’s spread across US airports, resorts and other tourist retail channels.

In August, it opened The Well, its newest concept featuring locally-sourced artisanal gifts in a “hydration-focused environment”, located in Terminal A at Sacramento International Airport (SMF). The 3,500 sq ft space “ties environmentally friendly products and distinctive gifts from Northern California to travellers from around the world”.

WH Smith said it has “strong and highly visible near-term growth prospects” and that “the combination with WH Smith's existing operations, including [digital accessories retailer] InMotion, will strengthen the group's International Travel offering.” In fact, the transaction will broadly double the size of that part of WH Smith’s offer.

Carl Cowling, who joins WH Smith as CEO at the start of next month, said the proposed acquisition adds a “highly successful US travel retailer with a fast-growing airport business” to the firm’s mix. Combined with InMotion, which it acquired last year, it “will significantly enhance our scale and growth opportunities in the US,” he added. 

MRG’s CEO Michael C Wilkins and existing team will be joining the combed group and will stay in charge as the US operation.

Wilkins added that the deal "is an incredible milestone for our business” and that it “unlocks’ huge potential.

WH Smith has over 1,600 stores, mainly in Britain, while MRG currently operates 170 stores in North America, with 59 of these inside airports. A further 33 new airport stores are expected to open by the end of 2024 following a series of successful tenders, and it’s expected to add approximately 43,000 sq ft of airport retail selling space, representing an increase of more than 75% from its current airport footprint.

WH Smith said that following the transaction, the group will be able to access all relevant categories in the $3.2 billion US airport travel retail market, ranging from news & gift products to speciality products (such as digital accessories, souvenirs, gifts, apparel, and licensed brand retailing). “This enhanced offering is expected to present substantial future opportunities for WH Smith to compete in increasingly sophisticated tenders,” it said.

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