The recent tough times have weighed on the share price

The two companies met last week after Permira offered 375 pence a share, 44% more than Friday's closing price.

The purchase would be a mix of cash and shares. WH Smith reminded shareholders that talks were at an early stage and as yet no final offer had been made.

Poor sales figures and a slump in share price over the past six months have left WH Smith open to predatory bids.

One stop

The problems facing the company, which is expected to cut a quarter of staff at its headquarters, are far from unique.

Along with chemist Boots and supermarket operator Safeway, WH Smith is often called a "legacy brand".

Simply put, this is a company that has been around for a long time, that worked in the past but is struggling today.

WH Smith has been losing customers as rivals including Tesco offer cut price compact discs, DVDs and books.

Time-conscious shoppers today can pick up the papers and stationery while they get the groceries.

According to the BBC's business editor Jeff Randall, the company is failing to stand out.

"What is WH Smith's unique selling point?" he asks. "What does it offer that customers can't buy or get more easily somewhere else?"

WH Smith facts 742 shops across the UK More than 31,000 employees Sales of �2.9bn in 2003 Click for WH Smith share data

"The collapse in the company's share price tells you that the City doesn't rate its prospects," he continues.

WH Smith, for its part, is aware that it needs to make changes.

Under new chief executive Kate Swann, the company is reviewing its businesses.

Some analysts have said that WH Smith will lose even more ground to rivals unless it cuts bureaucracy and speeds up its decision-making process.

A spokeswoman told BBC News Online that WH Smith plans to release details of job cuts along with its interim earnings data on Thursday this week.

In recent years, a number of UK retailers have been bought by investors, including Bhs, Selfridges and Harvey Nichols.

Who says you have to buy books from a bookshop?

Despite its problems, many analysts see WH Smith as a company that still has potential.

Its 742 shops are spread across the UK in almost all the top shopping areas, as well as airports and train stations.

The brand and logo, meanwhile, are easily recognisable.

And if the Sunday papers are anything to go by, WH Smith isn't the only one currently being eyed up.

"The buyout investors must believe they know something that the current management doesn't," said the BBC's Jeff Randall.