The new owner of WHSmith’s high street stores cannot initiate widespread closures for at least 12 months, despite planning rapid restructuring at its other retail properties.
According to Sky News, Modella Capital would forfeit its right to a one-year transitional services agreement (TSA) with WHSmith if it launches a company voluntary arrangement (CVA) before the first anniversary of the acquisition’s completion.
WHSmith agreed to sell its 480 high street shops to Modella in a £76m deal, ending 233 years of high street presence. Modella plans to rebrand the chain as TGJones after the takeover is complete.
Sky News reported Modella’s plans to implement CVAs at both Hobbycraft and The Original Factory Shop, which it acquired nine and three months ago, respectively. These restructuring processes have placed numerous stores at risk.
A Modella spokesperson said: “We have a number of exciting plans for the future of TGJones. A CVA is not on the agenda, as it is a solvent business.”
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