The TG Jones restructuring shows how a retail rescue can cut rents and bind landlords who vote against it. For landlords, occupiers and suppliers, the key issues are lease terms, evidence and early action.
On 1 July 2026, the High Court sanctioned two linked plans for the former WH Smith high street business. They involved TG Jones High Street Limited and TG Jones Retail Holdings Limited. Mr Justice Hildyard gave his fuller reasons on 5 August 2026. See the TG Jones judgment, [2026] EWHC 2079 (Ch).
TG Jones restructuring: what happened?
TG Jones, also searched for as TGJones, is the former WH Smith high street business acquired by Modella in 2025. However, it faced severe cash pressure. Without the plans, its projected funding shortfall reached £26.3 million by 3 August 2026. The court accepted insolvent administration as the most likely alternative (judgment, paragraphs 25 and 148).
The rescue aimed to fund a turnaround, reduce the store estate and compromise debts. The business plan forecast a smaller footprint of 302 stores. That was a forecast, not confirmation that every planned closure had occurred (paragraph 33).
What changed for rents, leases and funding?
The TG Jones restructuring did not treat every lease alike. Instead, it grouped properties by their economics and importance to the business. The judgment, paragraphs 20–21 and 47–59, sets out the detailed terms:
- Excluded leases: 91 leases remained outside the plans. These included some of the best sites and leases on favourable terms.
- Rent concessions: Many landlords faced reduced rent, while some categories received no rent during the three-year concession period.
- Deferred rent: For relevant categories, part of the first-year concession became secured deferred debt rather than a permanent write-off. However, repayment depends on the plan terms and whether the landlord terminates.
- Exit rights: Affected landlords received termination or break rights. As a result, their commercial choice included whether to accept revised terms or recover the premises.
- Funding: Modella had advanced £10 million to bridge the business to restructuring. It also committed a £15 million new-money term loan.
Importantly, eligible creditors share 50% of cumulative reported EBITDA above £40 million for financial years 2027–2029. EBITDA means earnings before interest, tax, depreciation and amortisation; the threshold is not turnover. The entitlement remains subject to the plan terms (paragraphs 39–44).
Why could the court bind dissenting landlords?
Part 26A of the Companies Act 2006 permits “cross-class cram-down”. In short, the court can sanction a plan despite opposition from a creditor class. However, section 901G imposes safeguards, as the judgment explains at paragraphs 122–127.
- No worse off: No member of a dissenting class may be worse off under the plan than in the relevant alternative.
- Qualifying support: At least one qualifying class must approve by 75% in value of those present and voting. That class must receive a payment or have a genuine economic interest in the relevant alternative.
- Judicial discretion: Meeting those conditions does not guarantee sanction. The court must also assess fairness, including how the plan shares its burdens and benefits.
The relevant alternative means what the court considers most likely if it refuses sanction. In the TG Jones restructuring, that meant insolvent administration rather than trading on existing lease terms. Nevertheless, the court scrutinised differential treatment and Modella’s retention of equity. It ultimately found the plans fair in the circumstances (paragraphs 148–194).
5 lessons from the TG Jones restructuring
- Check your lease category. First, identify the proposed treatment of rent, arrears and dilapidations. Then check notice requirements and any break or termination deadlines.
- Test the alternative outcome. Review valuation assumptions, likely recoveries and the costs of an empty property. For example, void periods and reletting costs may affect the commercial comparison.
- Engage before the vote. British Land’s negotiations helped improve the terms before it withdrew opposition. Therefore, consider whether coordinated negotiation could achieve useful concessions.
- Look beyond the headline rent cut. Deferred rent, security, exit rights and profit sharing can change the value of the package. Compare both cash timing and recovery risk.
- Assess fairness as well as minimum recovery. A better result than insolvency is important, but it is not the whole test. Consider how the plan allocates value between creditors and shareholders.
These practical lessons draw on the court’s analysis of negotiations and fairness. British Land also argued that future rent concessions should count like new-money contributions. However, the judge left that issue undecided because it was unnecessary to the outcome (paragraphs 199–207).
What does this mean for occupiers and suppliers?
The TG Jones restructuring also illustrates risks beyond landlord rent. A plan can compromise supplier claims and other liabilities, with different treatment across creditor groups. Therefore, suppliers should check their category, expected recovery and continuing supply obligations.
For occupiers considering a rescue, credible forecasts and fair treatment matter. Meanwhile, landlords should compare the revised lease package with realistic alternatives. Neither side should assume that this decision dictates the outcome of another case.
Speak to Equitable Law about your position
Equitable Law advises landlords, occupiers and other business stakeholders on commercial legal issues. Our business law services include advice on the legal and commercial implications of restructuring proposals.
If a tenant’s restructuring affects your property or business, contact Equitable Law to discuss your position. Please have the plan documents, relevant lease or contract and any voting or notice deadlines available. We can then discuss the scope of advice you need.
This article reflects publicly available sources as at 16 September 2026. It provides general information, not legal advice. Seek advice on your own facts before acting or allowing a deadline to pass.
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Equitable Law – The TG Jones Restructuring: What Landlords and Occupiers Need to Know
