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WHSmith is strengthening its offering in UK hospitals with the acquisition of UNS Group, a retailer in the hospital sector, for £19 million in cash. It has also announced a franchise agreement with motorway services operator RoadChef that will see the roll-out of 29 WHSmith travel units.

The UNS acquisition will be funded from existing cash resources and available bank facilities and is expected to be earnings neutral in 2007/08 and earnings accretive in 2008/09.

UNS Hospitals trades as United News and has 72 retail units and eight Caffe Nuovo
coffee shops in 62 hospitals throughout the UK. WHSmith currently has eight units trading in seven hospitals.

Kate Swann, WHSmith group chief executive, believes it is a growing channel: “The acquisition of UNS Hospitals creates growth opportunities for our travel business. The hospital channel is under developed and the combination of the UNS management team and the WHSmith brand will bring benefits for customers.”

The franchise agreement struck with RoadChef will see WHSmith open travel units in all 29 RoadChef motorway service areas. This announcement follows a successful trial at the RoadChef service area on the M1 at Watford Gap.

Commenting, Swann said: “We look forward to working with RoadChef to extend our motorway service area offer, bringing WHSmith products and services direct to the motorist.”

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