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WH Smith's brand communications director Katie Spriggs has confirmed that MediaCom, Walker Media, Starcom Motive, Universal McCann and Carat will fight it out for the media business, while the creative agencies remain undisclosed.

AMV'S chief executive Cilla Snowball said that the parting with the retailer after holding the £9m account for eight years was amicable.

"The decision not to enter the WH Smith pitch is a tough one but the right one for the agency," Snowball said.

Spriggs said that it would be asking ad agencies how best the troubled retailer could move its brand forward.

"We have decided to invite a number of agencies to give us their best objective thinking on how we can build further upon these brand assets and position WH Smith most competitively in the future," she said.

A decision is to be made on the media business in two months' time and the review is being overseen by Billetts, while the creative review will be completed by May 1.

AMV won the advertising business from Bartle Bogle Hegarty in 1996 and has since been responsible for some of WH Smith's most memorable ad campaigns, including those starring 'Only Fools and Horses' star Nicholas Lyndhurst.

However, the ads were dropped in June last year as the company claimed that it was looking at diverting a greater proportion of its above-the-line spend away from TV and into other media in an attempt to make its marketing budget work harder.

WH Smith was forced to issue a profit warning last month after flat like-for-like sales over the holiday period. This was the retailer's third profit warning in less than a year.

In November, Kate Swann, former managing director of Argos, was brought in to try to revive the fortunes of the beleaguered retailer.

She replaced Richard Handover, who took the role of WH Smith chairman. According to reports, Swann is midway through a review that will lead to redundancies at the Swindon head office.

She has already axed the role of managing director UK retail, which was held by Beverley Hudson. Marketing director Muriel Stirling was also axed last month. Stirling oversaw marketing, advertising and PR at WH Smith. With her departure, the role will be restructured and the new marketing director will report to a commercial director, who is also to be recruited.

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