TG Jones, the retailer formerly operating as WH Smith’s high street division, is pursuing a last-resort restructuring plan to avert collapse amid ongoing financial challenges. The company, owned by private equity firm Modella Capital, is seeking court approval for a turnaround strategy involving significant store closures, renegotiated rent agreements with landlords, and delayed payments to suppliers.

TG Jones currently operates approximately 450 stores and employs around 5,000 people. The proposed restructuring would see up to 150 stores closed, with substantial rent reductions across the remainder of the estate. Under the latest revision presented by Modella, landlords of more than 120 stores would receive no rent for three years, while rents on others would be reduced between 15% and 75%. In addition, landlords are offered the chance to share 50% of any profits exceeding £40 million in annual turnover over the next three years, a notable increase from previous proposals that featured a higher profit threshold and a smaller share of potential upside.

The plan will be subject to a vote among creditors and must receive court approval during a hearing scheduled for June 29. TG Jones is employing a "cram down" mechanism, which allows the restructuring to proceed if at least one class of creditors approves and the court determines that creditors will not be worse off than if the company were liquidated.

Chief executive Alex Willson, who took the role in March, has emphasized the urgency of the plan, warning that without court approval, the retailer faces imminent collapse. He has acknowledged the aggressive nature of the restructuring but described it as the sole viable option to save TG Jones and protect thousands of jobs. Willson also committed to investing in store refurbishments—including new lighting, repairs, and technological upgrades—alongside efforts to improve staffing levels and reduce prices.

However, the plan has met with resistance from major landlords and suppliers. An alliance of institutional landlords, including Landsec, M&G, NewRiver REIT, and British Land, has voiced objections to the significant rent cuts and terms they regard as fundamentally unfair. Some landlords have intimated they might repossess premises, while others have filed formal notices opposing the restructuring.

Similarly, Modella has informed several key suppliers, including Condé Nast, Ferrero, and Lonely Planet, of a six-month delay in repayment of outstanding debts. Suppliers are expected to be repaid in monthly installments over a subsequent year. Retail industry observers have warned that such terms may cause frustration among suppliers, potentially leading to contract terminations or demands for upfront payments, which could worsen TG Jones’s financial pressures.

A spokesperson for TG Jones stated that many suppliers remain supportive and continue to provide goods under normal terms despite the delayed payments. The company has also reported interest from new suppliers eager to participate in its future plans.

As the legal hearing approaches, TG Jones and Modella face a critical juncture in their efforts to restructure the business. The outcome will determine whether the retailer can execute its turnaround plan or ultimately face closure.