Up to 150 former WH Smith stores to close as high court approves restructure

WH Smiths was bought by the private equity firm Modella Capital last year and rebranded TG Jones. Photograph: Antonio Olmos/The Guardian View image in fullscreen WH Smiths was bought by the private equity firm Modella Capital last year and rebranded TG Jones. Photograph: Antonio Olmos/The Guardian Up to 150 former WH Smith stores to close as high court approves restructure Restructuring plan involves writing off debts to suppliers and cutting rent for many landlords Business live – latest updates Up to 150 former WH Smith high street stores are to close after the high court approved a swingeing restructure that could affect thousands of jobs. The books to paperclips retailer, which has 450 stores and employs about 5,000 staff, was bought by the private equity firm Modella Capital, which also owns Hobbycraft, last year and rebranded TG Jones. It had warned it might have to call in administrators if the restructuring plan, which involves writing off debts to suppliers and cutting rent for many landlords, was not approved. On Wednesday Alex Willson, the chief executive of TG Jones, said: “We welcome the court’s approval of our restructuring plan. This decision allows us to move ahead with our turnaround strategy. Former WH Smith’s small suppliers to lose at least half of debts in rescue plan Read more “The plan protects the substantial core of the store estate and makes TG Jones a stronger, more sustainable business. We are incredibly grateful to all the colleagues, partners and stakeholders who engaged constructively throughout the process, and to Modella Capital for its continued financial commitment.” More than 80% of landlords controlling TG Jones’s top stores voted to support the deal last week with most other classes of landlords, who will face swingeing rental cuts under the plan, voting against it. Several different classes of creditor voted over two days last week on the restructure but the plan required approval – judged as backing from 75% or more – from just one class of creditor and from a high court judge to go ahead. Only 72% of business rates creditors – mostly local councils – backed the plan and less than a third of general creditors, who include card makers and pen brands, gave it the thumbs up. No landlords owning unwanted stores where rent will be cut to zero or closed backed the plan. Small suppliers, such as card and toy makers, are to lose at least half the money owed to them by the former WH Smith high street chain under the restructure. Explore more on these topics WH Smith Retail industry Real estate Job losses Private equity news Share Reuse this content