Secure Trust Bank provides £50m ABL facility for high street deal

Secure Trust Bank Commercial Finance (STB CF) has announced its support for private equity firm Modella Capital in the acquisition of WH Smith Plc’s UK high street operations, providing a £50 million asset-based lending facility to back the landmark deal.

The acquisition marks a significant transformation for one of the UK’s best-known retail brands. WH Smith, founded in 1792, will retain its name across travel locations including airports, railway stations, and hospitals, as well as in its international operations. However, its high street stores, spanning 464 locations, will now be rebranded as TG Jones, ushering in a new era under Modella Capital’s ownership.

The funding from STB CF will help underpin the working capital needs of the business as it focuses on revitalising its presence on the UK high street, optimising operations, and accelerating growth.

This transaction signals a continued resurgence in retail sector M&A activity for Secure Trust Bank Commercial Finance, which has completed multiple high-profile deals in partnership with Modella Capital. Past collaborations include Modella’s acquisition of Hobbycraft, as well as a facility provided to Ann Summers in January 2024 to boost its online retail expansion.

Sean Toal, CEO at TG Jones, said: “The high street stores have a rich history and exciting future and we are focused on investing in our people, products and customers to reinforce our position under the new brand TG Jones. We’re pleased to have the support of Modella Capital and Secure Trust Bank Commercial Finance, who both understand the retail landscape and share our ambition for sustainable growth.”

“Having worked with STB CF previously, we knew they would be the perfect partner for this transaction, and this latest deal with the team has allowed us to unlock significant working capital, setting TG Jones up for long-term success.”

Tony Young, Regional Sales Director at Secure Trust Bank Commercial Finance, commented: “This deal demonstrates the strength of asset-based lending in enabling strategic private equity acquisitions and providing ongoing operational support, and it’s great to continue adding to our portfolio of retail deals. We look forward to continuing our partnership with Modella Capital and the management team as they continue to drive the business forward under the TG Jones brand.”

The transaction also reflects STB CF’s increasing focus on private equity partnerships, having completed 10 deals across eight sponsors in the last year alone, up from six deals in the previous 12 months.