Latest news with #Hilco
The Sun
14 hours ago
- Business
- The Sun
Up to 200 Poundland stores at risk of closure amid major restructuring plan in a bid to ‘survive' on the high street
A POPULAR affordable retailer could be facing mass store closures. In a bid to ensure the company's future, a major restructuring plan is reportedly in the works. 2 The consequences of this plan could include mass store closures and steep rent cuts for discount retailer Poundland. Since being put up for auction in March of this year, the bidding war has been whittled down to investors Hilco and Gordon Brothers. A decision on which investor will take over is set to be announced in the coming days. Pepco has previously said it expects the sale of Poundland to be completed by September. New investors will take on the restructuring plan being led by managing director Barry Williams. Barry previously left the company two years ago but was brought back to Poundland's board of directors earlier this year amid growing financial concerns. It is expected to cost £70m to £100 million to stabilise the company as it struggles with declining sales. The Telegraph reported that the company has already identified hundreds of stores for rent reductions and possible closures ahead of a possible sale. Between 150 and 200 stores of the company's 800 stores are thought to have been earmarked for immediate closure. There is also speculation that the retailer will impose rent reductions on landlords between 10 and 50 per cent. Poundland to be sold for JUST £1 as frontrunner for shock takeover is revealed after wave of store closures At other locations, they will pull out of agreements entirely, dependent on a judge's approval as part of the court-sanctioned restructuring scheme. It is uncertain what will happen to the retailer's 16,000 staff. Owners of Poundland, Pepco, cited " highly challenging trading conditions" as the reason behind its sales dropping 6.5% to £830.8 million in the six months to March 31. A Pepco Group spokesperson said: 'The focus of the Group and advisers is currently on a potential sale of Poundland. This is an ongoing process, and no final decisions have been taken.' It comes as the chain is set to close two branches later this month. Poundland's Bristol branch is set to close on June 20, while its Flint store will shut up shop on June 21. An additional eight stores have closed since the start of May, while a further 12 have shut since March 2024. Another five are earmarked for closure from June 11. This has affected branches in major cities like Liverpool and Ipswich, leaving retailers disappointed. This is the full list of stores that have closed, or are set to close in the coming months: Connswater Shopping Centre, Belfast – closed March 2024 Macclesfield – closed August, 2024 Maidenhead – closed October, 2024 Sutton Coldfield – closed October, 2024 Clapham Junction Station, London – closed May 2 Belle Vale Shopping Centre, Liverpool – closed May 6 St George's Centre, Gravesend – closed May 8 Southwark Park Road – closed May 14 Copdock Mill Interchange, Ipswich – closed May 20 Brackla, Wales – closed May 24 Chiswick High Road – closed May 28 Filton Abbeywood – closed May 31 Surrey Quays – closing June 11 Union Gate, Bristol - closing June 20 Flint - closing June 21 Cowes, Isle of Wight – closing July (exact date tbc) Newquay, August 1 2
Telegraph
3 days ago
- Business
- Telegraph
Poundland plots rent cuts in battle for survival
Poundland bosses are hatching a plan to enforce steep rent cuts on store landlords as part of a last-ditch bid for survival. The discount retailer has earmarked hundreds of stores for sharp rent reductions as its Polish parent company looks to persuade new owners to take the chain off its hands. An auction of Poundland has been whittled down to a shoot-out between the distressed investment funds Gordon Brothers and Hilco. The winning bidder will inherit a radical new turnaround plan drawn up by senior management, which proposes taking the axe to Poundland's sprawling estate of more than 800 stores. Between 150 and 200 have been singled out for imminent closure with as many as 500 more selected for swingeing rent bill decreases as bosses seek to dramatically rein in costs. Poundland employs 16,000 people. It is understood the company hopes to impose reductions on landlords of anywhere between 10pc and 50pc, while pulling out of scores of other sites via a court-sanctioned restructuring scheme. However, there is no guarantee that a judge will approve the proposal. A source familiar with the situation said any future decisions on rents would be for a potential new owner. Such extreme steps are usually attempted via an insolvency process known as a company voluntary arrangement in which landlords are handed a vote on any cost-cutting measures that will affect them. Barry Williams, the retailer's former managing director, was parachuted back on to the board at the beginning of the year to help address Poundland's spiralling crisis. Pepco crashed to a £548m loss in December after taking a £650m write-down on its UK operations. It blamed a 'significant decline in performance' as well as spiralling costs at Poundland for the setback. Under new owners, closures are expected to be accompanied by a huge cash injection as they seeks to turn around Poundland's dwindling fortunes. Prospective backers anticipate having to immediately pump in between £70m and £100m to stabilise the company. Those involved in the talks say Poundland's advisers at Teneo hoped to have entered exclusive talks with one of the remaining bidders this week. However, the timetable appears to have slipped, prompting speculation about whether investor appetite had waned as result of the funds needed to turn the retailer around and concerns over the complexity involved. There are also worries that trading at Poundland has continued to deteriorate, exacerbating its precarious situation. Last month, Pepco told investors not to expect 'major proceeds' from any sale of Poundland. It also warned that the chain might not make a profit in the forthcoming financial year. The business continued to face 'highly challenging trading conditions' in the six months to the end of March, it said. Like-for-like sales were down 7.3pc and pre-tax earnings slumped three quarters to €22m (£18.6m). A Pepco Group spokesman said: 'The focus of the group and advisers is currently on a potential sale of Poundland. This is an ongoing process and no final decisions have been taken.'
Yahoo
3 days ago
- Business
- Yahoo
Poundland plots rent cuts in battle for survival
Poundland bosses are hatching a plan to enforce steep rent cuts on store landlords as part of a last-ditch bid for survival. The discount retailer has earmarked hundreds of stores for sharp rent reductions as its Polish parent company looks to persuade new owners to take the chain off its hands. An auction of Poundland has been whittled down to a shoot-out between the distressed investment funds Gordon Brothers and Hilco. The winning bidder will inherit a radical new turnaround plan drawn up by senior management, which proposes taking the axe to Poundland's sprawling estate of more than 800 stores. Between 150 and 200 have been singled out for imminent closure with as many as 500 more selected for swingeing rent bill decreases as bosses seek to dramatically rein in costs. Poundland employs 16,000 people. It is understood the company hopes to impose reductions on landlords of anywhere between 10pc and 50pc, while pulling out of scores of other sites via a court-sanctioned restructuring scheme. However, there is no guarantee that a judge will approve the proposal. A source familiar with the situation said any future decisions on rents would be for a potential new owner. Such extreme steps are usually attempted via an insolvency process known as a company voluntary arrangement in which landlords are handed a vote on any cost-cutting measures that will affect them. Barry Williams, the retailer's former managing director, was parachuted back on to the board at the beginning of the year to help address Poundland's spiralling crisis. Pepco crashed to a £548m loss in December after taking a £650m write-down on its UK operations. It blamed a 'significant decline in performance' as well as spiralling costs at Poundland for the setback. Under new owners, closures are expected to be accompanied by a huge cash injection as they seeks to turn around Poundland's dwindling fortunes. Prospective backers anticipate having to immediately pump in between £70m and £100m to stabilise the company. Those involved in the talks say Poundland's advisers at Teneo hoped to have entered exclusive talks with one of the remaining bidders this week. However, the timetable appears to have slipped, prompting speculation about whether investor appetite had waned as result of the funds needed to turn the retailer around and concerns over the complexity involved. There are also worries that trading at Poundland has continued to deteriorate, exacerbating its precarious situation. Last month, Pepco told investors not to expect 'major proceeds' from any sale of Poundland. It also warned that the chain might not make a profit in the forthcoming financial year. The business continued to face 'highly challenging trading conditions' in the six months to the end of March, it said. Like-for-like sales were down 7.3pc and pre-tax earnings slumped three quarters to €22m (£18.6m). A Pepco Group spokesman said: 'The focus of the group and advisers is currently on a potential sale of Poundland. This is an ongoing process and no final decisions have been taken.' Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
The Sun
27-05-2025
- Business
- The Sun
Poundland shutting another three branches with 200 more at risk – see full list of stores closing in days
POUNDLAND is set to close three more stores over the coming weeks with up to 200 stores at risk. The bargain retailer will close a number of branches weeks ahead. 1 This includes three branches across Filton, London and Cowes, which are due to begin closing as soon as this Saturday. The South Gloucestershire store is due to shut on May 31 giving shoppers just shy of a week to say their goodbyes. News of the closure came as a shock to locals who described the move as a "shame". Others said they were "gutted" for the staff that work there. A spokesperson for the brand confirmed the closure to The Sun and also said shoppers are welcome to visit nearby sites in Emersons Green Retail Park store or other locations across Bristol. Meanwhile, a branch in Surrey Quays, in London will close on June 11. Finally, a branch in Cowes in the Isle of Wight will close come July. The branch opened back in 2021, so it brings an end to a near four year stint in the area. It comes after it was reported that up to 200 stores could close as part of Poundland's rescue deal. Bidding for the business started last week. A source told The Sunday Times that Poundland would be priced at "effectively a pound." Gordon Brothers, the ex-owner of Laura Ashley and Homebase owner Hilco are reported to be in a two way race to win the chain. Poundland to be sold for JUST £1 as frontrunner for shock takeover is revealed after wave of store closures A decision on who the preferred bidder is could be announced in the coming days. Polish retail giant Pepco said it expects the sale of Poundland to complete by September. These closures come on top of seven more stores which have been flagged for closure this month. Bosses at Poundland have already called time in a branch in Clapham Junction Station and Copdock Mill Interchange Ipswich. A popular branch in Belle Vale Shopping Centre, Liverpool also closed on May 6. This comes on top of a closure in Brackla Wales which is due to take place on May 24. A few months back, Poundland was forced to close a branch in Belfast after the Connswater Shopping Centre was put into receivership. A branch in Bermondsey, London also closed on May 14. You can see the full list of closures below: Maidenhead – closed October 2024 Sutton Coldfield – closed early October 2024 Macclesfield – closed August 2024 Cowes, Isle of Wight – July 2025 (exact date tbc) Surrey Quays – closing June 11 2025 Filton Abbeywood – closing May 31 2025 Chiswick High Road – closing May 28 2025 Copdock Mill Interchange, Ipswich – closed May 2025 Southwark Park Road – closed May 14 2025 Belle Vale Shopping Centre, Liverpool – closed May 6 2025 Clapham Junction Station, London – closed May 2 2025 Brackla, Wales – closed May 24 2024 St George's Centre, Gravesend – closed last week Connswater Shopping Centre, Belfast – closed end of March WHAT IS GOING ON AT POUNDLAND Last month, its parent company Pepco is said to have hired advisory firm Teneo to oversee the sale of the UK business. It comes after Pepco said it was looking at"all strategic options" to separate Poundland from its brand. The Polish group said it might turn its focus to its more profitable businesses in Europe. Pepco previously warned that upcoming hikes to employer National Insurance Contributions (NICs) and national minimum wage would significantly add to its costs. Late last year, it was revealed that profits at Poundland also tumbled by £641million in the year to September, with bosses again blaming slow sales amid a poor outlook thanks to measures set out by Reeves. A spokesperson also said the huge loss was "due to a non-cash impairment at Poundland that relates to the acquisition of the UK chain in 2016". RETAIL PAIN IN 2025 The British Retail Consortium has predicted that the Treasury's hike to employer NICs will cost the retail sector £2.3billion. Research by the British Chambers of Commerce shows that more than half of companies plan to raise prices by early April. A survey of more than 4,800 firms found that 55% expect prices to increase in the next three months, up from 39% in a similar poll conducted in the latter half of 2024. Three-quarters of companies cited the cost of employing people as their primary financial pressure. The Centre for Retail Research (CRR) has also warned that around 17,350 retail sites are expected to shut down this year. It comes on the back of a tough 2024 when 13,000 shops closed their doors for good, already a 28% increase on the previous year. Professor Joshua Bamfield, director of the CRR said: "The results for 2024 show that although the outcomes for store closures overall were not as poor as in either 2020 or 2022, they are still disconcerting, with worse set to come in 2025." Professor Bamfield has also warned of a bleak outlook for 2025, predicting that as many as 202,000 jobs could be lost in the sector. "By increasing both the costs of running stores and the costs on each consumer's household it is highly likely that we will see retail job losses eclipse the height of the pandemic in 2020."
Sky News
23-05-2025
- Business
- Sky News
WH Smith buyer ousted from auction of struggling discounter Poundland
The investment firm which has agreed to buy WH Smith's high street operations has been eliminated from the auction of Poundland, the struggling discounter. Sky News has learnt that Poundland's owner, Pepco Group, has shortlisted two rival firms to buy Poundland, which needs a capital injection of more than £50m to aid a turnaround plan. A Pepco insider said on Friday that Hilco, the former owner of HMV and Homebase, and former Laura Ashley-owner Gordon Brothers were involved in a two-way race to buy the chain. They added that a decision on a preferred bidder was likely within days. Pepco said this week that underlying earnings at Poundland could be wiped out in the current financial year, underlining the scale of the challenge facing a new owner. If a deal does get agreed with either of the remaining bidders, they would also be required to repay roughly £30m of debt owed to Pepco. Poundland employs more than 15,000 people across an estate of over 800 shops in the UK and Ireland. Industry sources say that roughly 100 stores are likely to be earmarked for closure by a buyer given their poor performance. Recent tax hikes announced by Rachel Reeves, the chancellor, in last autumn's Budget have increased the financial pressure on high street retailers. In recent months, chains including Lakeland and The Original Factory Shop have changed hands amid challenging circumstances. Advisers at Teneo are advising on the Poundland auction.
