When ex-CEO Demos Parneros filed suit against Barnes & Noble in August, he mentioned that another bookseller nearly bought B&N earlier this year.
For months, people in the publishing industry wondered about the identity of the mystery would-be buyer.
People familiar with the situation say it was WH Smith PLC, a U.K. retailer that sells books, stationery and other products.
A spokeswoman for Barnes & Noble declined to comment. The company said last month that it is evaluating a possible sale and noted it had received interest from multiple parties, including executive chairman, Leonard Riggio.
Representatives for W.H. Smith didn't respond to requests for comment.
I don't think WHSmith was really that interested - not after it got a look at B&N's books, anyway - but this story is quite plausible. After walking away from the B&N deal, WHSmith announced it was paying $148 million for InMotion, an airport retailer with 114 stores in 43 airports.
With annual revenues around $1.6 billion, it's not hard to guess why WHSmith passed on buying B&N. Not only is B&N significantly larger, it is also financially unhealthy and is run by a management team that is given to turning what should be well-kept secrets into embarrassing public spectacles.
If B&N interacted with WHSmith with the same nasty infighting as B&N is now conducting itself in public, no wonder WHSmith backed out of the deal.