By Duncan Bridgeman
Friday 10th October 2003
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W H Smith's Melbourne-based Asia-Pacific chief financial officer, Chris Tait, said the Kiwi business was performing well and it would make no sense to offload it now.
"There's absolutely no truth in that whatsoever," he said yesterday.
But The National Business Review source was adamant a sale was imminent following WH Smith's recent exit from North America, where the group had racked up trading losses of more than £30 million.
The move, while expected, had opened up the possibility that WH Smith could become a potential bid or breakup candidate, resulting in further scaling down of its offshore operations.
A Whitcoulls sale was likely to take place early next year, following the appointment of a new chief executive at WH Smith, the source said.
Three local airport stores, now rebranded WH Smith, would be retained as part of the group's travel franchise but there was "no logical reason" to continue running the rest of the New Zealand business.
Mr Tait said Whitcoulls was a completely different business to that run in the US, which had no High Street presence.
"Obviously if there was a restructure there could be something that could happen but as far as I'm aware there is no restructure and this business isn't up for sale down here."
London-based WH Smith bought Whitcoulls in 2001 from the Blue Star Group after its parent, US Office Products, fell on hard times.
Founded in Christchurch in 1882, Whitcoulls was originally known as Whitcombe & Tombs. It merged with Christchurch printer and packager Coulls Somerville Wilkie in 1971 and was taken over by Brierley Investments in the 1980s and sold to Graeme Hart's Rank Group in 1991 for $71 million.
Then in 1996, Blue Star Group paid $320 million for the chain, which also includes Australia's 160 Angus & Robertson stores.
WH Smith is one of the world's largest book retailing businesses. The company announced last year an intention to expand in Australia beginning with shops in Sydney Airport.
The company issued a profit warning in August but insisted it was sticking to the group's international retailing ambitions.
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