Sale of US businesses

Smith WH PLC
18 September 2003

                                                               18 September 2003





                                 WH SMITH PLC

               SALE OF US AIRPORT AND HOTEL RETAILING BUSINESSES



WH Smith PLC today announces the sale of its two US businesses. Its US airport
retailing business ('US Airports Business') is being sold to the Hudson Group
for £41m ($64m) and its US hotel retailing business ('US Hotels Business') is
being sold to former management for £8m ($12.5m).



Following completion of these transactions, WHSmith will provide transitional
services for the US Hotels Business until 29 February 2004, after which the Head
Office in Atlanta will close. WHSmith will retain no ongoing operational
presence in the USA.



US Airports Business



The total consideration of £41m consists of £25m of cash and £16m of deferred
consideration payable by way of an interest bearing loan note with a 5% coupon.
WHSmith is selling 180 stores located in 23 airport locations together with
certain assets and liabilities associated with the US Airports Business.



The sale is conditional on receiving the necessary regulatory approvals and
assignment of leases from the airport landlords.  Both WHSmith and the Hudson
Group anticipate the transaction will complete within 2 months.



In the year to 31 August 2002, the US Airports Business generated sales of £133m
and store contribution before central costs of £8m.



US Hotels Business



The total consideration of £8m will be satisfied by way of an interest bearing
loan note with a 5% coupon.  WHSmith will hold a 15 per cent equity interest in
the company formed to acquire the assets. WHSmith will also provide a loan
facility of up to £4m to the new company. The US Hotels Business consists of 280
stores in Hotels across continental USA, the Caribbean and Hawaii.



The sale is conditional on receiving the necessary assignment of leases from
hotel landlords. It is anticipated that the transaction will complete within 2
months.



In the year to 31 August 2002, the US Hotels Business generated £83m of sales
and the stores incurred losses before central costs of £4m.



US Head Office



Following the exit of both businesses, the central Head Office in Atlanta will
be closed after providing transitional services to the purchasers for a maximum
period up to 29 February 2004. Closure costs are anticipated to amount to £7m.



Central administration costs in the year to 31 August 2002 were £20m.



Asset Values



An exceptional charge reflecting impairment of asset carrying values of the
businesses being sold was taken as at 31 August 2002 for £27m and a further £35m
charge was taken as at 28 February 2003.  The net asset value of WHSmith US
Travel Retail, as at February 2003, after these exceptional charges, was £43m.



Commenting on the proposed sale, Richard Handover, Group Chief Executive, WH
Smith PLC said:



'WHSmith operated profitably in the US market for sixteen years, when a
combination of an economic downturn and the terrorist attacks of September 11th
moved the businesses from profit to substantial losses.



'While the airport retailing market is one in which we will continue to
participate, in other parts of the world, the disposal of the hotels retailing
business would leave a sub-scale business in the US. The Board therefore decided
it was in the shareholders' best interests to exit from both the US hotel and
airport retailing markets.



'The disposals will be significantly earnings enhancing.'



James S.Cohen, President and CEO of the Hudson Group commented,



'This is an important strategic development for the Hudson Group allowing us to
extend the national recognition of the Hudson brand. This acquisition will raise
Hudson Group's premier retail footprint to 450 news and gift stores in North
American airports and commuter terminals, establishing the company as the
leading transportation retailer throughout North America.'





                                     -ENDS-

Enquiries:



WH Smith PLC
Richard Handover          Group Chief Executive               020 7409 3222
John Warren               Group Finance Director              020 7409 3222
Mark Boyle                Investor Relations                  020 7514 9630
Louise Evans              Media Relations                     020 7514 9624



Brunswick
Timothy Grey                                                  020 7404 5959


The Hudson Group
James Cohen                President & CEO              001 201 867 3600 xt.1003
Joseph DiDomizio           Executive Vice President             001 201 939 5050
Sonya Buckman              VP Public Relations/Communications   001 201 939 5050



Notes to Editors



WHSmith



WH Smith PLC is one of the UK's leading retail groups incorporating
market-leading companies in retail, publishing and news distribution.



WHSmith USA Travel Retail was established in 1985 with the acquisition of 300
hotel and airport stores from Elson's Inc.  By the late nineties the business
had established market-leading shares in both markets.  In 2000, Hazelwood
Enterprises, a hotel gift operator was acquired, quickly followed by the
purchase of Benjamin Books, an airport retailer, giving WHSmith a presence in 9
of the top 10 US airports.



The WHSmith USA Travel Retail business operated profitably for 16 years. In the
year prior to September 11th 2001, it generated profits of  £12m and operated
over 500 hotel and airport stores.



The Hudson Group



The Hudson Group currently operates over 250 news, gift and specialty stores in
North American airports and commuter terminals, in addition to being one of the
U.S's largest wholesale distributors of magazines and books.




                      This information is provided by RNS
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