Poundland’s parent company is preparing to hand over tens of millions of pounds to help finance a takeover of the British reduction chain in difficulty.
Sky News has learned that the Pepco group, on the Varsaw, should contribute a substantial sum to eight figures to finance the operations in Poundland as part of an agreement with Gordon Brothers which could be finalized this week.
Sources close to the process insisted on Tuesday that an agreement had not yet been officially agreed and that it was not yet certain to take place, with other always possible results.
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The Sunday Times changed the Gordon brothers as a favorite to buy Poundland last month.
If a transaction between Pepco and Gordon Brothers, the former owner of Laura Ashley, is struck, it will open the way for substantial job losses triggered by the likely closure of more than 100 Poundland stores across the country.
This figure could finally reach between 150 and 200 stores, putting thousands of jobs in danger.
Shapeless rent discounts should also be negotiated with Poundland owners, the Telegraph reported this weekend.
Gordon Brothers would have seen Hilco Capital competition to emerge as a favorite to conclude an agreement in recent days.
At least another party would be interested in teaching in recent weeks, while other contenders – including the new owner of the High Smith Street chain, Modella Capital – were eliminated earlier in the process.
A person close to the situation said it was conceivable that an agreement to sell Poundland to Gordon Brothers could be announced on Wednesday morning, with an official restructuring plan potentially after a short time after.
Poundland employs around 16,000 people in an area of more than 800 stores in the United Kingdom and Ireland.
The tax increases announced by Rachel Reeves, the Chancellor, in the budget last fall, increased financial pressure on street retailers.
In recent months, channels such as Lakeland and the original factory shop have changed hands in difficult circumstances.
Last weekend, Sky News revealed that River islandThe family clothing retailer, also worked with advisers on a restructuring plan, with store closings and possible job losses.
Pepco said last month that the underlying profits in Poundland could be destroyed during the current financial year, stressing the extent of the challenge that a new owner is confronted.
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In a statement published in Sky News, a spokesperson for Pepco said: “The group’s objective and advisers are currently on a potential Poundland sale.
“This is an ongoing process, and no final decision has been made.”
Neither Gordon Brothers nor Teneo, who manages the sales process, could be joined to comment.