Former WH Smith’s small suppliers to lose at least half of debts in rescue plan
Summary
Small suppliers, including the charity Help for Heroes, face losing at least half the money owed to them by the former WH Smith chain, now called TG Jones, if a restructuring plan is approved. TG Jones was bought by private equity firm Modella Capital last year and needs the plan to reduce costs and avoid going into administration.Key Facts
- TG Jones, formerly WH Smith, has 450 stores and is currently losing money.
- Modella Capital bought the retailer last year for £76 million and is leading the restructuring.
- The plan proposes cutting costs by reducing debts owed to suppliers, with some losing half or more of the money they are owed.
- “Exit contract” suppliers, such as toy and greeting card makers, may lose all their debts but could get some future profits if the company recovers.
- Help for Heroes and other “non-core” suppliers will receive less than half their owed money, with delayed payments over three and a half years.
- Large suppliers like Condé Nast and Ferrero will have delayed repayments and monthly installments starting six months after the plan’s approval.
- The restructuring may close up to 150 stores and seeks rent cuts on many others.
- Modella plans to invest £35 million to make the business stronger and more sustainable.
- Some landlords opposed the plan but British Land recently accepted improved terms, including better profit-sharing.
Read the Full Article
This is a fact-based summary from The Actual News. Click below to read the complete story directly from the original source.