More than 120 TG Jones high street stores face potential closure following court approval for a significant restructuring. Landlords of the previous WH Smith stores now operated by TG Jones are being urged to agree to a three-year rent-free period to reduce costs and prevent insolvency.
TG Jones’ legal representatives informed the High Court that without approval, the company would experience an £8 million weekly deficit, emphasizing the urgent need for the proposed changes. The approved plans involve an additional £15 million loan from Modella Capital, the company’s owners, along with reduced rental rates for landlords.
During a recent court session, Mr. Justice Hildyard acknowledged the complexities of the plans but ultimately sanctioned them, recognizing the critical nature of the situation. The chain was rebranded from WH Smith to TG Jones after Modella acquired it, with the remaining WH Smith stores operating in travel locations like airports and train stations.
TG Jones currently operates approximately 450 stores with 4,700 employees predominantly in the UK. A legal representative for the company indicated that around 150 stores may close due to the restructuring plan, allowing landlords to terminate leases if they decline reduced rates.
The company has been struggling with long-term sales declines worsened by factors such as high inflation, increased online shopping, reduced consumer spending, and rising operational costs. The transition from WH Smith also negatively impacted sales performance. WH Smith was established in 1792 by Henry Walton Smith and his wife Anna and later expanded under their son William Henry Smith.
CEO of TG Jones, Alex Willson, expressed gratitude for the court’s approval of the Restructuring Plan, stating that it will strengthen the business and ensure sustainability. The decision received positive feedback from stakeholders, partners, and Modella Capital for their support throughout the process.