WH Smith to disappear from high streets as shops are sold for £76 million

The Hobbycraft owner has bought the chain

They confirmed that the 233-year-old brand will disappear from the high street after a “short transitional period”.

Under the terms of the deal, the high street business, which employs 5,000 staff, will be rebranded as TGJones. WH Smith is retaining its brand for its travel shops.

The books and stationery retailer will keep its almost 1,300 travel stores and online business but is looking at 'strategic options' including the sale of its digital greetings card business Funky Pigeon.

Industry experts predicted last month that at least half of the 480 WH Smith high street stores could close following a sale, raising fears of widespread job losses.

The deal gives the WH Smith high street business an enterprise value of £76m on a cash and debt-free basis. While WH Smith says it will realise £52m in cash proceeds, it will pocket only £25m after 'transaction and separation costs'.

Carl Cowling, the group chief executive at WH Smith, said: "As we continue to deliver on our strategic ambition to become the leading global travel retailer, this is a pivotal moment for WH Smith as we become a business exclusively focused on travel.

"As our travel business has grown, our UK high street business has become a much smaller part of the WH Smith Group. High street is a good business; it is profitable and cash-generative with an experienced and high-performing management team.

"However, given our rapid international growth, now is the right time for a new owner to take the high street business forward."

Modella acquired Hobbycraft last year and also owns The Original Factory Shop chain.

A spokesperson for the company said the TGJones name for the chain had been chosen to give the same 'family' feel as the venerable WH Smith brand.

They said: "TGJones feels like a worthy successor to the WHSmith brand. Jones carries the same sense of family and reflects these stores being at the heart of everyone’s high street."

The company, which runs 800 stores under the various brands it owns, including Create & Craft and Crafter’s Companion, said it was 'very much business as usual' while it looked to 'define and execute' a strategy for the retailer and introduce new offerings.

In January, the Communication Workers Union (CWU) raised fears that a sale could make some communities 'postal deserts', because 200 post offices were operated within the retailer’s shops.

However, Modella said it intended to 'keep all the same products and services, including the Post Office and Toys R Us', which operates concessions within WH Smith stores.