TG Jones Restructuring Plan 2026: Former WH Smith Stores Face Closure as High Court Hears Insolvency Case

TG Jones, the retailer formed from the sale of WH Smith's high street division to private equity firm Modella Capital in 2025, faced a critical High Court sanction hearing on 29 June 2026 on a restructuring plan that represents the business's only stated alternative to administration. The court heard that the company faces an £8 million cash shortfall by the end of this week if the plan is not approved.

What Is TG Jones and How Did It Get Here?

WH Smith sold its UK high street division - approximately 480 stores trading as newsagents, stationers, and book retailers - to Mayfair-based private equity firm Modella Capital in 2025 for £40 million. WH Smith retained its travel retail business covering airports, hospital units, and railway stations, which has proved far more commercially resilient. The high street division was subsequently rebranded as TG Jones, losing the WH Smith name that the business had carried for more than 230 years.

Modella stated that the forced rebrand "negatively impacted consumer awareness, despite the fact that the proposition has improved." The chain's CEO Alex Willson, who took over in March 2026, told creditors the business had reached a critical point: "We just don't have the cash to continue."

The Restructuring Plan: What It Involves

The restructuring plan is brought under Part 26A of the Companies Act 2006, a court-supervised rescue mechanism introduced under the Corporate Insolvency and Governance Act 2020. Key elements of the plan presented to the High Court:

• Closure of up to 150 stores - described in court as a "working assumption" representing roughly one-third of the current estate
• Modella Capital to inject £35 million in new funding, following a £10 million loan already provided in April 2026
• Substantial rent reductions across the remaining store estate - landlords facing cuts they have described as the most aggressive retail restructuring ever seen on the UK high street
• Revised terms offered to landlords: 50% of profits above £40 million over three years, up from a significantly lower share in the original proposal
• Modella has committed not to extract dividends while reduced rental agreements remain in place
• Small suppliers will be "wiped out altogether" according to reporting on the court submissions - larger suppliers face long waits to recoup amounts owed

The Debt Position

Court documents and creditor communications confirm TG Jones owes:

• £4 million to suppliers
• £3.4 million in outstanding business rates
• £8.4 million to HMRC

Some local councils have threatened bailiff action to seize goods from TG Jones stores if outstanding business rates are not settled. The total creditor exposure is substantially larger when landlord arrears and trade creditor balances are included.

What Is a Part 26A Restructuring Plan?

A restructuring plan under Part 26A of the Companies Act 2006 is a court-supervised rescue process that allows a company to restructure its liabilities while continuing to trade. Unlike administration, the company's directors typically remain in control during the process. A key feature is the "cross-class cram-down" - the ability for the court to approve the plan even where one or more creditor classes vote against it, provided the court is satisfied that those creditors would not be worse off than in the likely alternative (in this case, administration).

Restructuring experts have noted that court approval is often seen as a procedural step once creditor meetings have taken place, because judges weigh the plan against the alternative outcome for creditors. However, the scale of losses being imposed on landlords and suppliers in this case has generated significant opposition.

What Happens to Employees If Administration Occurs?

If TG Jones enters administration, approximately 4,700 employees would be directly affected. Under the Insolvency Act 1986 and the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE), employees of a business that enters administration retain certain protections:

• Employees cannot be dismissed solely because the business enters administration
• If the business is sold as a going concern by the administrator, TUPE may apply and employment may transfer to a buyer on existing terms
• Where jobs are made redundant, statutory redundancy pay is calculated based on age, weekly pay (capped at £643 per week from April 2026), and length of service - minimum 2 years service required
• Unpaid wages, outstanding holiday pay, and notice pay rank as preferential debts in an insolvency - paid ahead of most creditor claims but behind secured creditors
• The Redundancy Payments Service (part of the Insolvency Service) can pay statutory entitlements where the employer cannot - gov.uk/claim-redundancy

What Happens to Gift Cards and Loyalty Points?

Gift cards and loyalty scheme balances are typically unsecured creditor claims in an administration. They rank behind secured creditors, preferential creditors (employees), and HMRC for corporation tax. In practice, gift cards are frequently frozen or honoured at a reduced value depending on the administrator's decision and the outcome of any business sale. Anyone holding a TG Jones gift card should seek to use it immediately given the uncertainty. The administrator's appointment, if it occurs, will be published at Companies House and via the Insolvency Service's register at insolvency-official-receiver.service.gov.uk.

WH Smith Travel: Not Affected

WH Smith plc - the listed company retaining the WH Smith brand in airports, railway stations, hospital units, and motorway services - is a separate legal entity and is not part of the TG Jones restructuring. WH Smith travel retail continues to operate independently. WH Smith shares have fallen more than 60% over the past year reflecting its own difficulties including a £25 million pre-tax loss in the six months to February 2026 and a profit warning citing reduced international tourism related to geopolitical pressures. These are separate issues from the TG Jones high street restructuring.

What is TG Jones?

TG Jones is the rebranded successor to WH Smith's UK high street division, which was sold to private equity firm Modella Capital in 2025 for £40 million. The chain operates approximately 450 stores. WH Smith retained its travel retail operations at airports, hospitals, and railway stations and is a separate company.

Are WH Smith stores closing?

The closures affect TG Jones - the former WH Smith high street stores, now trading under the TG Jones name. Up to 150 of approximately 450 stores may close under the restructuring plan. WH Smith travel retail (airports, hospitals, railway stations) is a separate business and is not affected by the TG Jones restructuring.

What rights do TG Jones employees have?

Employees of a business in administration retain statutory protections including TUPE rights if the business is sold. Redundant employees with at least 2 years service are entitled to statutory redundancy pay. Unpaid wages and holiday pay rank as preferential debts. The Redundancy Payments Service can pay statutory entitlements where the employer cannot - see gov.uk/claim-redundancy.

What happens to TG Jones gift cards?

Gift cards are unsecured creditor claims and may be frozen or honoured at reduced value in an administration. Anyone holding a TG Jones gift card should seek to use it immediately given the uncertainty. Check the Insolvency Service register for administrator appointment notices if the restructuring plan fails.

What is a Part 26A restructuring plan?

A Part 26A restructuring plan is a court-supervised rescue mechanism under the Companies Act 2006 that allows a company to restructure debts while continuing to trade. Unlike administration, directors typically remain in control. The cross-class cram-down power allows courts to approve the plan even if some creditor groups vote against it, provided those creditors would not be worse off than in administration.