The Wall Street Journal has reported that the company rumored to have been near an acquisition of Barnes & Noble this spring is W.H. Smith. The Financial Times added, in its own reporting, that W.H. Smith's results for fiscal year 2017 mentioned £2 million spent on "costs related to an uncompleted transaction." If B&N had been bought by W.H. Smith, one of the U.K.'s largest book retailers, the Journal said the move "could have transformed" the bookstore chain which is undergoing a difficult business turnaround.
Word of the possible sale broke over the summer, after former B&N CEO Demos Parneros filed a defamation lawsuit against B&N. Parneros, whose firing was initially explained by B&N as being over unspecified company violations, claimed in his suit that, among other things, his relationship with B&N founder Len Riggio soured after a deal to buy the company fell through in June.
Last week, B&N responded to Parneros' s claims, saying that he 'intentionally sabotaged a potential acquisition of the company.'"
Parneros has since denied that he tried to stop the deal from going through, telling the Journal in a statement, “I was fully supportive of the sales process from the start.” Neither B&N or W.H. Smith provided a comment to the Journal about its report.
If the deal with W.H. Smith had gone ahead. it would have involved a smaller company buying a larger one. W.H. Smith had sales of $1.65 billion in the fiscal year ended August 31, 2018, compared to sales of $3.7 billion for B&N in the fiscal year ended April 30, 2018. WH Smith posted an operating profit of $213 million compared to a net loss of $125 million for B&N, a figure which includes $135 million in one-time charges.
Last week, W.H. Smith agreed to acquire InMotion, a U.S. company that operates 114 stores across 43 airports. It sells a range of digital accessories, including headphones and earbuds, travel accessories, mobile power, portable speakers and action cameras, but not books. In addition to its bookstores, W.H. Smith operates a travel retail business that had revenue of $879 million in the last fiscal year.
This story has been updated with further information.