Is Poundworld going into administration, will there be store closures and where is the head office?


POUNDWORLD is at risk of collapse after a buyer walked away from talks to rescue the business.

The retailer could be expected to call in administrators within days if it doesn’t find a buyer, according to a source, putting 5,100 jobs at risk.

 Poundworld could face closure if it doesn't find a buyer soon

PA:Press Association

Poundworld could face closure if it doesn’t find a buyer soon

Is Poundworld going into administration?

Yes. An announcement was made at 10am on June 11.

The budget retailer is poised to appoint Deloitte to handle an administration after last-ditch rescue talks with R Capital broke down last weekend.

Its possible collapse comes after other well-known high street retailers Toys R Us and Maplin fell into administration earlier this year.

It is understood that TPG and Poundworld’s management rejected offers to buy the business out of a pre-pack administration, and were hoping to sell it as a solvent business.

Other parties named as possible buyers were turnaround specialist Alteri Investors and Poundworld‘s founder Chris Edwards.

The budget brand was put up for sale by it’s owner TPG Capital after heavy losses in the previous two financial years.

Losses for the financial year 2016-17 were £17.1m, up from £5.4m the year before.

The retailer’s move would come just days after House of Fraser detailed its plans to shut 31 stores, affecting around 6,000 jobs.

On June 19, Poundworld announced they would be cutting 100 jobs from its head office in Normanton.

Poundland has stepped in to offer guarantee job interviews to Poundworld staff.

Writing on LinkedIn, retail director Austin Cooke at Poundland UK and Ireland said they would “guarantee an interview” to Poundworld staff.

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He also provided a dedicated email address for them to get in touch: recruitment@poundland.co.uk.

How many stores face closure?

Staff were told that Poundworld would be having “closing down sales” from Thursday, June 21.

But Deloitte has said that no stores are “definitely” closing at this stage as a search for a buyer continues.

Poundworld, which is owned by TPG Capital, has around 350 stores and employs 5,100 people.

Earlier this year, both Maplin and Toys R Us called it a day, and CarpetrightMothercare and New Look have all announced that they will be closing stores.

Marks & Spencer announced it will shut a further 14 stores as part of its restructuring plan.

 5,000 retail jobs at risk as Poundworld rescue talks collapse
5,000 retail jobs at risk as Poundworld rescue talks collapse

Who owns Poundworld?

Investment company TPG, which bought a majority stake in Poundworld in 2015, also controls the restaurant chain Prezzo whose landlords and creditors agreed a restructuring last month.

It is understood that TPG and Poundworld’s management rejected offers to buy the business out of a pre-pack administration, and were hoping to sell it as a solvent business.

TPG Capital – Texas Pacific Group – is a US investment company based in Fort Worth, Texas and San Francisco, California but also has offices around the world.

The firm was founded in 1992 by David Bonderman, James Coulter and William S Price III.

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Restaurant groups including Carluccio’s, Prezzo and Byron have also been shutting dozens of stores as they are squeezed by rising costs and a fall in consumer spending.

Just last week, Marks & Spencer announced it will shut a further 14 stores as part of its restructuring plan.

Earlier this month, Mothercare also announced it will close 50 stores in a bid to save the struggling firm – putting hundreds of jobs at risk.

Which high street stores have closed in 2018? Shop closures in full from Mothercare and Maplin to Toys R Us and Carpetright

 

 





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