The US owner of Poundland has said the high street chain remains “challenged and vulnerable” after holding talks with ministers amid government criticism of its handling of the retailer. Gordon Brothers said on Thursday morning that it was still in “active discussions” with interested suitors and had been seeking to “protect as many jobs as possible”. Poundland filed a notice to appoint administrators last week, with the fate of its 12,000 staff and about 2,000 suppliers uncertain.
Gordon Brothers, the US restructuring specialist that bought Poundland last year for £1 and launched a sale process for the company at the start of September, is under pressure to accept a bid to save the retailer, which is on the brink of collapse despite receiving solvent takeover offers. Last week the chain filed a notice of intention to appoint administrators, which gave the business 10 working days of breathing space from creditors to secure a potential rescue deal before potentially entering insolvency. The board of Poundland has lined up the advisory company AlixPartners to run the process after Gordon Brothers ceased providing funding.
On Wednesday, executives from Gordon Brothers and Poundland separately held meetings with government ministers regarding the future of the retailer. Advisers are still in talks with parties interested in buying the brand and a large number of stores, about two months after a sale process was launched. However, the chance of Poundland avoiding mass store closures and job losses is shrinking by the day as suppliers have held back on deliveries, hurting its ability to trade.
On Thursday, a spokesperson for Gordon Brothers said: “We are pursuing all avenues through the sale process to find a solution which protects as many jobs as possible and preserves value. That would pay off about half the £30m shareholder loan, the majority of which was taken on by Gordon Brothers when it bought the company. Meanwhile, Xyra Group Holdings, a little-known London-based investment company, has offered to pay £12.5m to rescue the business, according to ITV News.
It reported that the firm wants to buy Poundland, retain its existing management team and expand the discount chain overseas. Xyra was approached for comment. The Irish company Innovest Holdings is also in the mix, and was publicly backed by Reform UK’s Robert Jenrick at the weekend.
It is understood it is being advised by the former Reform election candidate Charles Bunker. The prime minister, Andy Burnham, said the owner needed to find a “practical solution” to keep stores open and save jobs. Asked what his message was to Poundland’s executives, Burnham said: “Focus on the people in your employment … Come up with a practical solution that saves jobs and saves those stores because many of them are viable propositions.
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