The Mayfair-based firm renamed the stores TG Jones and pitched them as the "hub of the high street." That vision has collided with a simpler reality: shoppers did not follow. The restructuring, advised by consultancy Teneo and law firm Slaughter and May, puts hundreds of retail jobs at risk and marks the latest chapter in Modella's pattern of rapid acquisition and disposal of high street assets.

150 stores to go: what the restructuring involves

The planned closures amount to more than a quarter of the 480 stores Modella bought from WH Smith in 2024 for £40m. A City source described the rescue plan as "aggressive stuff," as reported by City AM.

Modella said it had not taken the decision lightly, stating that "the survival of this iconic 234-year-old business is our imperative," according to the same report. The firm had previously delayed the restructuring, which was initially due to begin last month.

The scale of the closures raises immediate questions about lease obligations, redundancy costs, and the knock-on effects for landlords in towns where TG Jones may be among the few remaining anchor tenants. Modella held just £12.8m in net assets in 2024, according to its most recent balance sheet, a figure that looks thin against the liabilities of a 480-store estate.

No specific timeline for the closures has been made public. The involvement of Teneo, which specialises in restructuring advisory, and Slaughter and May, one of the City's leading insolvency-adjacent law firms, suggests the process may involve a formal insolvency mechanism such as a company voluntary arrangement.

The rebrand problem: why losing the WH Smith name mattered

The core difficulty is one of brand equity. WH Smith, founded in 1792, had near-universal name recognition on British high streets. Modella was required to drop the branding as part of the acquisition terms, replacing it with TG Jones, a name with no existing consumer awareness.

Modella itself has acknowledged the damage. The rebrand "negatively impacted consumer awareness, despite the fact that the proposition has improved," the firm said, as reported by City AM. The company added that the business had struggled since it was "forced" to lose the WH Smith branding.

This is a cautionary data point for any operator considering an acquisition where the brand does not transfer. The stores' physical locations, product range, and staff may have remained largely the same, but the loss of a trusted name proved enough to erode footfall. For customers, TG Jones was not a refreshed WH Smith; it was an unfamiliar shop in a familiar unit.

The problem was arguably foreseeable. Brand recognition is one of the few durable advantages a high street retailer holds over online competitors. Stripping it away overnight, without a substantial marketing investment to build the replacement, left the chain competing on location alone, a weak position in a market where footfall has been declining for years.

Modella's track record: a pattern of rapid acquisition and disposal

The TG Jones restructuring does not exist in isolation. Modella Capital, originally formed as Tailer Debtco in 2022 before being renamed a year later, is owned by Hay Wain Group, the family office founded by turnaround specialist Jamie Constable.

The firm has built a portfolio of distressed high street retailers at pace. Two of its earlier acquisitions, The Original Factory Shop and Claire's Accessories, were placed into administration less than two years after Modella bought them. All stores across both chains closed last month, as reported by City AM.

Meanwhile, Modella is reportedly weighing a sale of Wynsors World of Shoes, a northern England footwear retailer it acquired just four months ago, according to the same report. If confirmed, that would represent one of the shortest holding periods in recent UK retail private equity history.

The sequence invites scrutiny. Buy distressed assets cheaply. Attempt a rapid repositioning. If it fails, restructure or dispose. Critics of this model argue it extracts residual value, through property deals, stock liquidation, or management fees, while leaving creditors, employees, and landlords to absorb the losses. Defenders counter that without buyers like Modella, many of these businesses would have entered administration sooner, with no prospect of rescue at all.

What is clear is that the track record so far offers limited evidence of successful turnarounds. Three major acquisitions have now ended or are heading towards significant store closures. A fourth may be sold before any turnaround is attempted.

What this means for high street operators and landlords

For landlords, the closures represent another wave of vacancy risk on already fragile high streets. Many of the former WH Smith units sit in secondary and tertiary town centres where replacement tenants are scarce. The prospect of 150 empty units arriving on the market simultaneously will weigh on rental expectations and property valuations in those locations.

For operators and boards considering acquisitions of distressed retail chains, the TG Jones episode underscores a specific risk: the gap between asset value and brand value. Modella acquired 480 stores for roughly £83,000 per unit, a price that reflected the physical estate's worth. But the brand, the element that actually drove customers through the doors, stayed with WH Smith.

WH Smith itself has not escaped unscathed from the separation. The company, which retained its travel division covering airports, hospitals, and train stations, reported a £25m pre-tax loss for the six months to February 2026 and adopted a "more cautious outlook," according to City AM. The retailer cited reduced international tourism linked to the Iran conflict as a key factor. Shares fell following the announcement.

A broader signal

The fragility exposed here is not unique to Modella or TG Jones. UK high street retail continues to operate under structural pressure from online competition, rising business rates, and shifting consumer habits. Private equity interest in distressed retail assets has grown precisely because entry prices are low. But low entry prices often reflect genuine operational difficulty, not hidden value waiting to be unlocked.

The question for the sector is whether the buy-cheap-and-restructure model can produce outcomes that benefit stakeholders beyond the acquiring firm. On current evidence from Modella's portfolio, the answer remains uncertain.

"The survival of this iconic 234-year-old business is our imperative." , Modella Capital, as reported by City AM

That imperative now rests on whether the remaining 330 or so TG Jones stores can build a customer base from scratch, without the name that drew shoppers in for more than two centuries.