Causeway ups stake in WH Smith, backs management

(Sharecast News) - Activist investor Causeway Capital has upped its stake in struggling retailer WH Smith, it has emerged.
The US investor, which is agitating for a boardroom shake-up at Rolls Royce, now has a 9% stake in the retailer, worth around £178m, making it WH Smith's largest shareholder.

Causeway has publicly called on Anita Frew to bring "fresh thinking" to the aerospace group when she takes over as chair next month.

But it insisted it backed WH Smith's management. Issuing a statement in response to the Sunday Times, which first reported the increased stake, portfolio manager Jonathan Eng said: "We are firm believers in the strategy and management team of WH Smith, which is why we first invested last March and why we have continued to add to our shareholding.

"We have confidence in the long-term growth potential of the business and are happy to be the company's largest shareholder."

Earlier this month, the 229-year-old retailer warned that next year's profits would be towards the lower end of expectations, which it blamed on ongoing uncertainty around international travel. Sales in the eight weeks to 28 August were at 71% of pre-pandemic levels.

As at noon BST, shares in WH Smith where ahead 3% at 1,559.0p.

Los Angeles-based Causeway has around $47bn of assets under management.