WH Smith sells Hodder Headline to French rival

Kate Swann, the chief executive of WH Smith, pressed ahead yesterday with the first step of her plan to return the troubled newsagent chain to its former glory with the £223m sale of its publishing business.

Hachette Livre, the publishing arm of the French media conglomerate Lagardere, is acquiring Hodder Headline for £210m in cash. Hachette, whose UK interests comprise the Octopus, Orion and Watts publishing houses, will also take on Hodder's £13m pension deficit.

Analysts hailed the deal as a signal that the tide of apathy that has held back WH Smith's performance for years had begun to turn. Rhys Williams, of Seymour Pierce, said: "The timing of the announcement is quicker than we were anticipating and so must be seen as positive."

WH Smith put Hodder up for sale in June, just weeks before the private equity group Permira dropped its putative bid for the newsagent-to-news distribution group. It is understood to have opted to sell Hodder, whose chief executive is Tim Hely Hutchinson, the UK publisher of Stephen King and James Patterson, to Hachette to try to avoid regulatory obstacles given the French group's small share of the UK publishing market.

The group also confirmed plans to hand back the bulk of the cash to shareholders. It pledged to return up to £207m, worth about 85p a share. It intends to consult institutional investors before deciding whether to opt for a tender offer or a special dividend, instead of an ongoing buy-back programme.

WH Smith bought Hodder, the UK's top further education publisher, in May 1999 for £185m. In 2002 it strengthened the business, buying the publishers John Murray and Robert Gibson. The business made an operating profit of £19m on sales of £144m in the year to the end of August. Its net assets, adjusted for the net pension deficit, were £256m.

Ms Swann said: "The sale of Hodder Headline is an important milestone in our strategy to simplify the structure of the group."

The disposal is subject to approval from the competition authorities. Shares in WH Smith rose 5p to 295p.

PROMOTED VIDEO
News
people
News
Renee Zellweger as Bridget Jones
i100
Arts and Entertainment
music
News
news

Sport
football

Follow the latest news and score as Chelsea take on Maribor at Stamford Bridge.

Life and Style
tech

Company reveals $542m investment in start-up building 'a rocket ship for the mind"

News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Helpdesk Analyst

£23000 per annum + pension and 22 days holiday: Ashdown Group: An established ...

Senior Helpdesk Analyst / Service Desk Co-ordinator

£27000 per annum + pension, 22 days holiday: Ashdown Group: An established ind...

Senior Pensions Administrator

£23000 - £26000 Per Annum: Clearwater People Solutions Ltd: Our client is curr...

Corporate Actions Administrator / Operations Administrator

£25 - 30k: Guru Careers: A Corporate Actions Administrator / Operations Admini...

Day In a Page

Two super-sized ships have cruised into British waters, but how big can these behemoths get?

Super-sized ships: How big can they get?

Two of the largest vessels in the world cruised into UK waters last week
British doctors on brink of 'cure' for paralysis with spinal cord treatment

British doctors on brink of cure for paralysis

Sufferers can now be offered the possibility of cure thanks to a revolutionary implant of regenerative cells
Let's talk about loss

We need to talk about loss

Secrecy and silence surround stillbirth
Will there be an all-female mission to Mars?

Will there be an all-female mission to Mars?

Women may be better suited to space travel than men are
Oscar Pistorius sentencing: The athlete's wealth and notoriety have provoked a long overdue debate on South African prisons

'They poured water on, then electrified me...'

If Oscar Pistorius is sent to jail, his experience will not be that of other inmates
James Wharton: The former Guard now fighting discrimination against gay soldiers

The former Guard now fighting discrimination against gay soldiers

Life after the Army has brought new battles for the LGBT activist James Wharton
Ebola in the US: Panic over the virus threatens to infect President Obama's midterms

Panic over Ebola threatens to infect the midterms

Just one person has died, yet November's elections may be affected by what Republicans call 'Obama's Katrina', says Rupert Cornwell
Premier League coaches join the RSC to swap the tricks of their trades

Darling, you were fabulous! But offside...

Premier League coaches are joining the RSC to learn acting skills, and in turn they will teach its actors to play football. Nick Clark finds out why
How to dress with authority: Kirsty Wark and Camila Batmanghelidjh discuss the changing role of fashion in women's workwear

How to dress with authority

Kirsty Wark and Camila Batmanghelidjh discuss the changing role of fashion in women's workwear
New book on Joy Division's Ian Curtis sheds new light on the life of the late singer

New book on Ian Curtis sheds fresh light on the life of the late singer

'Joy Division were making art... Ian was for real' says author Jon Savage
Sean Harris: A rare interview with British acting's secret weapon

Sean Harris: A rare interview with British acting's secret weapon

The Bafta-winner talks Hollywood, being branded a psycho, and how Barbra Streisand is his true inspiration
Tim Minchin, interview: The musician, comedian and world's favourite ginger is on scorching form

Tim Minchin interview

For a no-holds-barred comedian who is scathing about woolly thinking and oppressive religiosity, he is surprisingly gentle in person
Boris Johnson's boozing won't win the puritan vote

Boris's boozing won't win the puritan vote

Many of us Brits still disapprove of conspicuous consumption – it's the way we were raised, says DJ Taylor
Ash frontman Tim Wheeler reveals how he came to terms with his father's dementia

Tim Wheeler: Alzheimer's, memories and my dad

Wheeler's dad suffered from Alzheimer's for three years. When he died, there was only one way the Ash frontman knew how to respond: with a heartfelt solo album