Thousands of jobs could be cut as part of a rescue deal to save Poundland.
The high street favourite brand has 850 stores employing more than 16,000 staff across the country.
But hundreds of stores may have to be shuttered – regardless of whether a buyer is secured.
Poundland’s parent company revealed earlier this year it was considering ‘all strategic options’ to spin out the struggling chain from the wider group as it focuses on its more profitable Pepco brand.
Reports suggest the work required to turn things around would lead to a nominal sales price, which would be ‘effectively a pound’.
Gordon Brothers, the former owner of Laura Ashley, has emerged as a frontrunner to take control of Poundland, a source close to the matter told The Sunday Times.
Bids are expected to be made on Tuesday, they added.
Among those interested are Modella Capital, which recently bought WH Smith’s high street division; Alteri, owner of Bensons for Beds; and Hilco Capital, which owns Lakeland, according to Sky News.
Back in January, Pepco said that recent trading at Poundland stores was challenging as the UK retail environment became tougher towards the end of 2024.
Poundland revenues slid by 9.3% for the three months to December 31, with like-for-like sales down 7.3%, as it witnessed weaker clothing sales.
Sales remained in negative territory over January and February, Pepco said in March.
The company said then: ‘Poundland is a strong brand that serves millions of customers every week and had around two billion euros (£1.67 billion) in annual turnover in financial year 2024, but it is also operating in an increasingly challenging UK retail landscape that is only intensifying.
‘From April 2025, the UK Government’s additional tax changes announced in the Budget will also add further pressure to Poundland’s cost base.
‘Therefore, the board is actively evaluating all strategic options to separate Poundland from group during financial year 2025, including a potential sale.’
Retailers have been among the hardest hit by incoming measures announced in last October’s Budget to increase national insurance contributions, on top on another hike in the minimum wage.
Some 13,000 high street stores shut last year.
Big names such as WHSmith, Morrisons, Poundland and NatWest have all lost stores.
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