Hundreds of Poundland stores at risk of closure as chain is set to be sold
Hundreds of Poundland stores are at risk of closing as the retailer continues to look for a buyer. The move could potentially see thousands of jobs cut as a result.
Earlier in March, we reported that the budget high street chain had been put up for sale, with advisory firm Teneo leading the process after its owners, the Pepco Group, confirmed it was examining 'all strategic options' for the firm.
Reports now suggest that up to 200 loss-making stores have been identified as potential closures under the terms of any prospective deals, with The Times suggesting the firm could be sold for "effectively a pound".
Poundland currently operates around 825 stores across the UK and Ireland, with over 160,000 employees said to be currently working for the chain.
News of the potential closures come just as bids for the discounter are expected early this week, with an update from Pepco Group on its half-year results set to be unveiled this Thursday, May 22.
Formed in 1990, Poundland opened its first pilot store in Burton Upon Trent by co-founders Dave Dodd and Steven Smith. Now a multi-million pound company, it sells everything from household essentials and groceries to clothing and homeware.
While it initially sold prices at the advertised £1, products can now vary in price as the retailer struggles to battle rising costs and competition from other supermarkets and high street retailers.
Some sources have reported that Gordon Brothers, former owners of Laura Ashley, have emerged as a frontrunner for investors. The potential list of buyers also includes Hilco Capital and Endless.
Meanwhile, Modella Capital, the private equity firm that recently bought over WHSmith, is also said to be included on the list of potential investors.
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It is worth noting that, as of writing, no decisions have been made regarding the sale of Poundland.
News of Poundland's potential sale comes after the firm advised that it was struggling amidst a "challenging" UK retail landscape, with other contributing factors being changes announced in the Budget, including higher National Insurance contributions for employers and a rise in the minimum wage.
To help address its struggling performance, former Poundland boss Barry Williams returned to the board at the start of 2025, less than two years after leaving the firm.
Parent company Pepco is thought to have been "actively evaluating" all strategic options to separate the discounted firm from the business after it was found to be underperforming.
A Pepco spokesperson told the Daily Record: "As announced at the Capital Markets Day on 6 March, Pepco Group is moving away from FMCG to create a simpler business focused on higher margin clothing and general merchandise, and is actively exploring separation options for Poundland, including a potential sale, from the Group.
"With Barry Williams' re-appointment as Managing Director, Poundland is executing a turnaround programme to get the business back on track, focusing on its core heritage strengths, and a simpler pricing proposition and customer offer."
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