TG Jones owner Modella Capital has appointed advisers from Teneo to put together a restructuring plan designed to put the stationery retailer on a more sustainable footing.

The move, which comes less than a year after Modella took over the company, is set to lead to concerns over another series of store closures and job cuts at the business.

It is understood that around 80 TG Jones stores out of a total of roughly 480 are most at risk after a period of tough trading, according to the Telegraph.

Although no final decisions have been made, a store closure programme is reportedly one option on the table. However, Teneo is expected to evaluate alternative measures, such as a request for financial support from WHSmith.

The private equity firm’s ability to act is constrained by the terms of its takeover agreement, which reportedly stops it from shutting underperforming shops for 12 months after the £40m deal.

Modella executives have conceded that the business underestimated the impact of being unable to keep the WHSmith name above the stores under the terms of its buyout, according to reports.

Stores that are yet to be rebranded as TG Jones are understood to be performing better than the sites that have been modified.

A Modella Capital spokesperson said: “The economic conditions for all retail businesses are tough. The combination of cost inflation, weak consumer confidence and adverse government fiscal policies puts significant pressure on all retailers.

“Against this backdrop, the management of TGJones is working hard to turn around this important retail business, and they are drawing on the best available advice in doing so.

“TGJones’ management and Modella Capital are committed to building a sustainable future for this important UK business.”

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