Hobbycraft owner Modella Capital is among a number of parties circling WHSmith’s 232-year-old high street chain.
Modella, which acquired the crafts retailer in August, is understood to have held discussions with WHSmith and its advisors, Sky News reported.
However, it remains unclear on how close the firm is to completing a deal.
Modella is thought to one of several experienced retail investors, including Bensons for Beds owner Alteri, bidding for the retailer’s 500+ store portfolio.
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WHSmith confirmed over the weekend that it “is exploring potential strategic options for this profitable and cash generative part of the Group, including a possible sale.”
“There can be no certainty that any agreement will be reached, and further updates will be provided as and when appropriate,” it added.
The division recorded flat operating profit of £32m last year as sales slipped 4% to £452m.
It comes as WHSmith has increasingly focused its efforts on its travel retail business in recent years, which now accounts for 85% of the group’s trading profit. The company operates more than 1,200 stores across airports, train stations, and hospitals in 32 countries.
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