Creditors have failed to fully back value retailer Poundland’s restructuring plan, meaning a final decision will be made at a court hearing next week, Retail Week understands.
Poundland’s turnaround proposals - involving store closures, rent cuts and job losses - had to be put to creditors as part of a formal process.
However, following a series of virtual meetings held today for creditors such as landlords to approve the plan, it is clear that Poundland did not win the level of support required from the group.
It is understood that five out of 13 classes of creditor backed Poundland’s plan, so a decision on the retailer’s future will come at a court meeting - known as a sanction meeting - scheduled for next Tuesday.
The creditors’ decision is insufficient in itself to derail Poundland’s turnaround ambitions. Fashion retailer River Island faced similar opposition from some creditors when it undertook a similar process earlier this month, but its restructuring was subsequently given a green-light by the High Court a few days later. Poundland chiefs are thought to be optimistic that the same will happen this time.
A Poundland spokesperson was unable last night to confirm details of the creditor vote - formal confirmation is likely today (August 21) - but said: “Our restructuring plan is critical to our future as we look to preserve hundreds of jobs and thousands of stores.
“We have maintained an open, transparent dialogue with creditors through this process and now look forward to the sanctions hearing itself at the end of the month.”
Assuming its plan is approved, Poundland will return to a simpler business proposition powered by value appeal including the restoration of £1 price points.
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