The purchase of InMotion will double the size of the UK high-street retailer’s international travel retail business.
WHSmith’s travel business has in recent years played a vital role in the success of its operations, accounting for more than half of company revenues and two thirds of profits, making up for losses on the British high street. Where high-street revenues had fallen by 2% on an underlying basis in September and October, its travel business showed a rise of 4%. The retailer reported it marks the tenth consecutive year of profit growth for the retailer’s travel arm.
The announcement of the purchase of InMotion, the largest seller of digital accessories in US airports, fills a huge gap in the UK high-street retailer’s portfolio of travel destinations. WHSmith’s footprint of global travel stores includes Kuala Lumpur, Melbourne, Qatar and Mumbai, but until now the Unites States remained an untapped market.
WHSmith chief executive Steve Clarke called the £155m deal “a really good route into the US” which would allow the company to expand its stationery, book and convenience stores into airports across the country. He indicated the company’s intention to open InMotion stores outside the US.
Clarke added: “The acquisition of InMotion is an exciting value creation opportunity for the WHSmith Group and marks a major step in our international travel retail growth strategy.”
The takeover will add a further 114 stores across 43 US airports to WHSmith’s 300-strong chain of international travel stores, and is expected to contribute £130m revenues and an underlying profit of £18m this year.