Retailer Adjusts Deal with Modella Capital Amid Weaker Conditions

  • WHSmith sells high street business to Modella Capital for £40m after reducing price due to weaker trading conditions
  • Original deal was £52m, now £10m upfront with £20m in deferred consideration
  • Modella takes on 480 stores and 5,000 employees
  • WHSmith rebrands as TG Jones, focuses on travel retail and international growth

WHSmith has completed the sale of its high street business to private equity firm Modella Capital for a reduced price after facing weaker trading conditions. The original deal, announced in March at £52m, is now worth up to £40m. WHSmith will receive £10m upfront with an additional £20m tied to the future cash flow of the business until August 2026. An extra £10m may be realized based on specific tax assets. Modella, which owns Hobbycraft, takes over 480 stores and 5,000 employees. The company is rebranded as TG Jones, focusing on travel retail and international growth.

Factuality Level: 8
Factuality Justification: The article provides accurate information about WHSmith’s sale to Modella Capital, the reduced price due to weaker trading conditions, the number of stores and employees involved in the deal, and the company’s focus on travel retail and international growth. It also mentions the rebranding as TG Jones. However, it lacks some details about the specific tax assets and the transaction and separation costs remaining unchanged.
Noise Level: 3
Noise Justification: The article provides relevant information about WHSmith’s sale to Modella Capital and its impact on the company’s strategy, but it lacks in-depth analysis or exploration of long-term trends or consequences.
Financial Relevance: Yes
Financial Markets Impacted: No
Financial Rating Justification: The article discusses the sale of WHSmith’s high street business to Modella Capital at a reduced price due to weaker trading conditions, impacting the amount of money received by WHSmith. It also mentions the future cash flow of the business and transaction costs.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: There is no extreme event mentioned in the text.

Reported publicly: www.retailgazette.co.uk