Published: Mon, June 11, 2018
Finance | By Claude Patterson

5,000 jobs at risk as Poundworld slides towards administration

5,000 jobs at risk as Poundworld slides towards administration

A discount store has entered administration, putting thousands of jobs at risk across the UK.

Talks broke down over the weekend as Poundworld tried to broker a rescue deal with private equity firm R Capital.

Joint administrator Clare Boardman said: "The retail trading environment in the United Kingdom remains extremely challenging and Poundworld has been seeking to address this through a restructure of its business".

Talks with a potential buyer R Capital have collapsed meaning that the chain felt it had no other option but to put the company into administration.

The appointment of Deloitte as administrators leaves the future of five stores in the county hanging in the balance.

The filing provided it with protection as it looked to secure a deal, which would lead to store closures and an administration process, allowing its staff and suppliers continue to be paid.

"Unfortunately, this has not been possible".

Restaurant groups including Carluccio's, Prezzo and Byron have also been shutting dozens of branches as they are squeezed by rising costs and a fall in consumer spending.

Founded in 1974, Poundworld was sold to United States equity group TPG Capital for £150m in 2015.

The chain has a store at the Richmond Centre in Derry.

Deloitte's joint administrator, Clare Boardman, said: "The retail trading environment in the United Kingdom remains extremely challenging and Poundworld has been seeking to address this through a restructure of its business".

A TPG spokesperson said it was a "difficult decision for every party involved".

Poundworld has been losing money for the past two years.

The company is seeking landlord approval for the restructuring plan, which is a form of insolvency known as a Company Voluntary Agreement (CVA).

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