Poundland is on the verge of administration, placing approximately 12,000 jobs in jeopardy. The discount retailer is preparing to file a notice of intention to appoint administrators, a move that would grant the business a 10-working-day reprieve from creditor actions while it seeks a rescue deal. Although the notice has not yet been filed, sources indicate it is imminent.
Owner Rejects Takeover Offer
The chain is heading for insolvency after its owner, Gordon Brothers, rejected a takeover offer from Irish real estate firm Martin Property Group, which management had named as its preferred bidder earlier this month. Gordon Brothers, which acquired Poundland last year for £1, initiated a sale process for the retailer at the start of September.
In a memo to staff, Poundland managing director Barry Williams described the situation as “unexpected, unwanted and wholly avoidable.”
Interested Buyers and Advisers
Several parties are reportedly interested in acquiring parts of the Poundland business, including CDS Superstores, the owner of Wilko and The Range; Poundstretcher owner Fortress; and Modella, which owns TG Jones. The retailer has appointed advisers at AlixPartners to oversee the insolvency process and assess bids for all or parts of the company.
Poundland currently operates around 600 stores across the UK. Under Gordon Brothers, the company underwent a major turnaround programme that included closing more than 100 shops over the past year in an effort to stabilise its finances.
