Poundworld to become latest retail casualty with over 5000 jobs at risk
There are 12 stores in Northern Ireland - their futures are unclear today.
Last updated 11th Jun 2018
Poundworld is set to become the latest retail casualty on the British high street as it calls in administrators, putting 5,100 jobs at risk.
The budget retailer is poised to appoint Deloitte to handle an administration after last-ditch rescue talks with R Capital broke down over the weekend.
Poundworld, which is owned by TPG Capital, has around 350 stores. Its possible collapse comes after both 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.
But a deal could not be struck.
Poundworld's losses widened in 2016-17 to £17.1 million, from £5.4 million of losses 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. The store in Belfast, however, is not one of those earmarked for closure.
There are 12 Poundworld outlets in Northern Ireland:
- Newtownabbey
- Newtownards
- Omagh
- Armagh
- Craigavon
- Belfast Connswater
- Derry
- Belfast Donegall Place
- Belfast City Side
- Cookstown
- Bangor
- Belfast Boucher Road
Poundworld will continue to trade while a buyer for all or part of the business is sought, Deloitte said, adding that there are no redundancies or store closures at this time.
Clare Boardman, joint administrator at Deloitte, said: "The retail trading environment in the UK remains extremely challenging and Poundworld has been seeking to address this through a restructure of its business. Unfortunately, this has not been possible.
"We still believe a buyer can be found for the business or at least part of it and we are keeping staff appraised of developments as they happen. We thank all employees for their support at this difficult time.''
A TPG spokesman said: "This was a difficult decision for every party involved.
"We invested in Poundworld because of our belief in how the company serves its customers and the strength of its employees.
"Despite investing resources to strengthen the business, the decline in UK retail and changing consumer behaviour affected Poundworld significantly."