Poundland has hired adviser Hilco to renegotiate rents on 99p Stores, the business it acquired last month, Retail Week has learned.

Sources told Retail Week that Poundland, which listed on the stock market last year, is seeking a range of concessions from landlords, including 12-month rent- free periods and rates and service charge-only deals.

It is not clear how many of 99p Stores’ 251 branches Poundland is negotiating concessions on, or if any of the discussions with landlords could end in store closures.

While Poundland has said it intends to scrap the 99p Stores name and rebrand to its fascia, boss Jim McCarthy in August maintained it plans to retain all of 99p Stores’ branches.

Poundland declined to comment on the nature of the negotiations but a spokesman confirmed the retailer had hired Hilco as “adviser on the 99p Stores acquisition”.

“Hilco has significant experience in this type of transaction and will be assisting us with the smooth transfer and integration of the 99p Stores assets into the Poundland business,” he said. 

Hilco chief execuitve Paul McGowan said: “Hilco has been engaged by Poundland to assist in managing the 99p store assets following the recent acquisition. Hilco is providing additional operational support to the management of the 99p Stores business and in managing the transition of the store base to the Poundland fascia.”

Takeover approval

Poundland’s takeover of 99p Stores was given full clearance by the Competition & Markets Authority (CMA) in September. The regulatory body had launched an investigation over fears it could have a negative impact on consumer choice, but eventually concluded the takeover “may not be expected to result in a substantial lessening of competition”.

Poundland said last month that during the “longer-than-anticipated” CMA review process, which meant it had limited access to 99p Store’s trading performance data, the financial position of 99p Stores “weakened somewhat since our original due diligence”.

However, Poundland insisted the weakening does not affect its plans or potential synergies from the deal. Full details of what Poundland intends to do with the 99p Stores business will be revealed in November.