Poundland to close 68 branches after being sold for £1 - 82 more at risk
Poundland to close 68 branches after being sold for £1 - 82 more at risk
It is also scrapping some of its lines and closing two warehouses
A Poundland store in Blyth, Northumberland
Poundland has announced plans to close 68 stores and two UK warehouses as part of a restructuring plan after being sold to investment firm Gordon Brothers. The chain will also stop selling frozen food, reduce the amount of chilled food it sells, and stop selling online.
It will be closing its frozen and digital distribution centre in Darton, South Yorkshire, later this year and c losing its national distribution centre in Bilston, West Midlands, in early 2026. The discount chain, known for primarily selling products for £1, had been put on the market earlier this year after a sharp downturn in trading.
On Tuesday, Poundland said it is seeking court approval for a restructuring plan to shut 68 shops and secure rent reductions on dozens more.
The retailer said it expects to end up with between 650 and 700 stores after the overhaul. It currently runs around 800 stores across the UK and Ireland but stressed Irish shops have not been affected.
Poundland said it also plans to close its frozen and digital distribution site at Darton, South Yorkshire, later this year and another warehouse at Springvale in Bilston, West Midlands, in early 2026.
Around 350 people will be affected by the warehouse closures.
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The company has not disclosed how many store workers will be impacted.
It will also stop selling frozen food at stores where its currently offered and reduce its chilled food offer in the future.
Poland-based Pepco Group, which has owned Poundland since 2016, said on Thursday it completed the sale of the business for a 'nominal' fee. Sources close to the process have said this was £1.
Poundland's more-than-800 stores and roughly 16,000 employees will be transferred to the ownership of Gordon Brothers, the former owner of Laura Ashley, as a result. However as part of the deal, Poundland is set to undergo a restructuring plan, which will go through the High Court.
Poundland said the details will be communicated 'in due course'. It is understood full details of the shake-up will be sent to company creditors in the coming days.
The company is expected to seek around 100 store closures and a raft of rent reductions from landlords as part of the process. As part of the restructuring plan, Pepco is set to retain a minority stake in Poundland.
Gordon Brothers has also said it is providing up to £80 million of financing to help fund the turnaround plan. Last month, Poundland reported revenues dropped by 6.5% to 985 million euros (£830 million) for the six months to March, compared with a year earlier.
The brand suffered 'challenges across all categories' and had 18 net store closures over the period. Pepco said the deal will help it shift away from food and drinks, improve its revenue growth and boost its profitability.Stephan Borchert, Pepco Group chief executive, said: 'This transaction will strongly support our accelerated value creation programme by simplifying the group and focusing on our successful Pepco business.
'Poundland remains a key player in UK discount retail, with millions of customers annually and a well-loved brand and proposition.
'We want to sincerely thank all the Poundland team for their ongoing commitment and contribution to the group and wish Barry Williams and his team all the best for the future.'
Mr Williams, chief executive of Poundland, said: 'We welcome Gordon Brothers as we focus on returning Poundland to its core heritage category strengths and place as an essential business to UK households.
'We look forward to working with our supplier base to ensure we continue providing exceptional value to budget-conscious consumers in the UK.'
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Mark Newton-Jones, head of Europe, the Middle East and Africa at Gordon Brothers, said. 'We believe Poundland is an essential retailer serving UK consumers and plays an important role on the high street.'
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