Hundreds of jobs to go as Poundworld shuts 25 stores

Hopes are dimming for the survival of budget retailer Poundworld
Hopes are dimming for the survival of budget retailer Poundworld

Administrators to collapsed discount retailer Poundworld are to close 25 stores, resulting in 242 job losses.

The firm went bust last month and Deloitte, which is overseeing the process, has been attempting to secure a buyer for the business ever since.

But a memo to staff penned by the professional services firm, said: “As previously advised, the administrators have been preparing contingency plans in the event that we are not able to deliver a sale of the business as a whole.

“These plans have been continuing and it is with regret that the administrators have taken the decision to effect an organised wind-down of 25 stores, starting today.”

That last day of trading for the affected stores will be July 15.

Poundworld, which was formerly owned by private equity firm TPG Capital, has 335 stores and employs around 5,100 people.

The news comes as hopes for a rescue of the beleaguered retailer fade.

Deloitte last week turned down a bid for Poundworld from its founder, Chris Edwards, who was looking to save a raft of stores and safeguard around 3,000 jobs.

However, on Monday it emerged that the founder of rival Poundland, Steven Smith, is in early-stage talks on a bid to salvage part of Poundworld.

Deloitte said that with discussions are continuing with interested parties with offers received for a significant number of stores, the head office and distribution centre.

Clare Boardman, joint administrator at Deloitte, said: “Whilst we remain hopefully that a sale for part of the business can still happen, it has not been possible to sell the business as a whole, resulting in today’s announcement.”

Marks and Spencer bosses have warned that there could be more job losses at the high street chain as they push ahead with a radical transformation plan.

The retailer announced in May that it plans to close 100 stores by 2022, putting hundreds of jobs at risk.

Speaking at M&S’ annual general meeting (AGM) on Tuesday, chairman Archie Norman said the size of the company’s store portfolio had become “a drag on our performance”.

Mr Norman told shareholders that most of the 100 stores would be shut within the next two years, adding: “I can’t tell you it won’t be the last.”