Thousands of high-street jobs are under threat as Poundland edges closer to a rescue deal that could result in widespread store closures.
Bidders for the struggling discount chain are preparing final takeover proposals this weekend. Up to 200 unprofitable stores are earmarked for closure. Formal offers are expected to be submitted on Monday, and several interested parties are still in the running.
Industry insiders say the retailer is unlikely to survive without a significant restructuring, which would deliver another blow to Britain’s already embattled high streets.
Poundland currently operates 825 stores across the UK and employs around 15,000 people. Any new owner is expected to move quickly, potentially closing up to a quarter of the chain’s locations within weeks of taking control.
Turnaround specialists Hilco, Modella Capital, and Gordon Brothers are believed to be among the shortlisted bidders for Poundland.
Owner Pepco put the discount chain up for sale in March after a sharp downturn in performance, announcing the move alongside a €200 million (£168 million) share buyback plan.
Shares in Pepco, which is listed on the Warsaw stock exchange, jumped as much as 11% following the announcement.
Despite generating over €2bn in revenue in 2024, Pepco described Poundland as a “drag on the group’s financial performance,” citing slower revenue growth, lower gross margins, rising operational costs, and weaker profitability and returns on investment.
The company also pointed to Rachel Reeves’s National Insurance changes as adding “further pressure to Poundland’s cost base.”
Earlier in the year, Pepco had already cut Poundland’s valuation by nearly £650 million, blaming a “significant decline in performance” and mounting costs.
A turnaround under new ownership is expected to involve widespread store closures and a major cash injection. Analysts estimate that tens of millions of pounds will be needed to stabilise the business and restore profitability.
