Smiths going digital after Dawson deal

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Smiths News is set to break into the ebook market after it agreed to buy its academic-focused rival Dawson for £20m.

The newspaper and magazine wholesaler said Dawson's largest trading division – Dawson Books, which supplies to 80 per cent of the country's universities – would provide an established ebook platform for its own book wholesaler, Bertrams.

In addition, the acquisition of Dawson – which employs 408 staff – will help Smiths and its subsidiaries tap into new markets, including universities and airlines.

Smiths is proposing to transfer a number of Dawson's staff in Northamptonshire to its own locations in Norwich, Swindon and Bradford and warned that staff who do not transfer would be at risk of redundancy. Dawson's head office in Surrey will be closed. The proposals will be subject to consultation and there will be no immediate changes.

Dawson can be traced back to the early 19th century and has three divisions – Dawson Books, Dawson Media Direct, which supplies newspapers and magazines to airlines, and Dawson Marketing Services.

Dawson was best known for its newspaper-and-magazine-distribution business, which it put into administration two years ago. Dawson News lost millions of pounds' worth of contracts from the likes of Trinity Mirror and Associated Newspapers; its assets were snapped up by rivals that included Smiths News and John Menzies for about £2m in 2009.

The remaining three divisions at Dawson will be sold to Smiths News.

Hugh Cawley, Dawson's chief executive, said: "The offer follows the board's successful restructuring and turnaround plan, which first rescued the Dawson Group from the risk of administration and more recently returned the group to profit growth."