WH Smith sells Funky Pigeon brand for £24m in travel pivot
WH Smith has sold its Funky Pigeon brand to Card Factory, as the retailer sheds legacy assets ahead of a pivot towards becoming a pared down travel retailer.
The Bristol and Guernsey-based novelty greeting cards line was sold for £24m, with Card Factory looking to integrate its technology into its consumer business.
Funky Pigeon’s sale price was based on an average £32m revenue and around £5m EBITDA (earnings before interest, taxes, depreciation, and amortisation) over the past two financial years.
Going forward, the only remaining WH Smith shops will be in airports, train stations and motorway service stations – alongside some remaining stores in hospitals.
Growth on the cards?
Card Factory chief executive Darcy Willson-Rymer said: “This acquisition marks a significant step forward in Card Factory’s strategy to build a scaled, competitive digital presence in the celebration occasions market.
“Together, the enlarged customer base will benefit from a richer, more convenient customer proposition, combining the strength of our nationwide store estate and wider celebrations offer with Funky Pigeon’s exceptional digital experience.”
He added that the acquisition supports the firm’s “ambition to become the leading omnichannel retailer in our sector”.
“The Board and wider Card Factory team look forward to welcoming Funky Pigeon colleagues to the Group.”
Smith and Jones
Meanwhile, its high street stores have been flogged to the retail focused private equity firm Modella Capital, which owns retailers such as Hobbycraft and The Original Factory Shop.
The FTSE 250 investor will rebrand these outlets as TG Jones – a new marque aimed at evoking the heritage of the original brand.
Back in June, Swindon-based WH Smith PLC ended up knocking £12m off of the offer price for its 480 outlets.
The fire sale of high street stores was prompted by the business’s travel arm becoming increasingly profitable, while the retail line accounted for around 15 per cent of profits.