The seven TGJones stores at risk across south-west Wales face fresh uncertainty after new details emerged about the dire financial state of the chain — including millions of pounds in unpaid taxes and a looming threat of bailiff action.
Seven branches in the region — including the Swansea Quadrant, Neath, Llanelli, Carmarthen, Bridgend, Tenby and Haverfordwest — were put at risk last week when owner Modella Capital announced plans to close up to 150 stores nationally as part of a major restructuring.
Now documents circulated to creditors have revealed that TGJones owes £8.4 million to HMRC, with a six-month payment agreement struck in April — and a further £3.4 million in business rates arrears. The Telegraph has reported that bailiffs are now a real threat if those payments are not maintained.
The revelations paint a stark picture of a business that has deteriorated rapidly since WH Smith sold its 480 high street stores to Modella Capital in March 2025 and rebranded them as TGJones.
The sale was originally valued at £76 million, but this was renegotiated sharply downward to £42 million to reflect what was described at the time as a “sharp deterioration in trading conditions.” In reality, WH Smith received just £10 million upfront, with the remaining £32 million contingent on the business’s future cash flows — money that now looks unlikely ever to materialise.
Modella has since approached WH Smith to ask whether it would fund enhanced redundancy payments for staff likely to lose their jobs if stores close. WH Smith had previously offered staff a more generous redundancy scheme than the statutory minimum. It declined to provide any further support.
The development is significant for workers at the seven south-west Wales branches, who now face the prospect of statutory redundancy only if their stores are among those confirmed for closure.
The restructuring Modella is planning is known as a “cram-down” — a relatively novel legal mechanism that requires the consent of only one class of creditors to proceed, rather than a majority. It will require approval from a High Court judge, with a hearing expected in late June.
Landlords are likely to face demands for severe reductions in rent as part of the plan. Those who refuse could simply take back the keys to their stores.
If the restructuring is approved, Modella has promised to invest £35 million in a turnaround plan it claims would return TGJones to profitability, with what it describes as a “considerable investment” in the stores that survive.
The creditor documents also reveal the existence of a mystery private individual — described as not being linked to Modella — who is owed £8 million by TGJones. No further details have been disclosed.
The crisis comes as Modella’s track record with other retail brands comes under scrutiny. Both The Original Factory Shop and Claire’s Accessories — two other chains acquired by the firm — have been placed into administration in recent months. Modella blamed the worsening conditions on the British high street and tax rises enacted by the Government.
An insolvency specialist quoted in earlier reporting warned that the pipeline of retail closures was “far from over,” pointing to the collapse in discretionary spending, stubbornly low high street footfall outside major city centres, and the impact of rising National Living Wage costs and higher employer National Insurance contributions.
Post Office has previously said it will update communities if any of its services — hosted within TGJones stores — are forced to relocate as a result of the closures.
The High Court hearing in late June is now the key date for anyone with an interest in the future of the south-west Wales stores — and for the staff who work in them.
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