Poundworld on brink of collapse as last-ditch talks fail

Roman Schwartz
June 11, 2018

The collapse puts more than 5,000 jobs at risk, making it the biggest retail insolvency so far this year by job numbers.

Poundworld has around 350 stores across the UK.

Deloitte, which had been coordinating efforts to find a solvent deal, will oversee the administration process for the business, which is based in Normanton, West Yorkshire.

Carpetright (Other OTC: CGHXF - news), Marks & Spencer (Frankfurt: 534418 - news), Mothercare (Other OTC: MHCRF - news) and New Look are among the other retailers which have announced store closure plans this year, with thousands of jobs disappearing as a outcome. In 2016-17, losses for the financial year were £17.1m, up from £5.4m the year before.

'Unfortunately, this has not been possible.

Poundworld has gone into administration today following the collapse last week of talks with a rescue buyer.

In the meantime, they have said that no redundancies or store closes are planned during this period and Poundworld would continue to trade as usual while it sought a buyer.

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It also operates the Bargain Buys chain which has a store in Gravesend.

Many of these have been struck this year as retailers have struggled with surging costs, rising business rates, competition from online rivals and a slowdown in consumer spending.

A spokesman for TPG said putting the business into administration was a "difficult decision".

The retailer's move comes just days after House of Fraser announced plans to shut 31 stores, affecting around 6,000 jobs.

"We invested in Poundworld because of our belief in how the company serves its customers and the strength of its employees", he added.

Other retailers undertaking CVAs in a bid to keep trading include New Look, Mothercare and Carpetright.

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