Poundland has been sold by owner Pepco in a deal that will see the retailer secure an £80m cash injection to fund its turnaround.
The value retailer has confirmed its sale to investment firm Gordon Brothers, which will provide Poundland with up to £80m in financing to allow its management team to ”progress with a proposed restructuring and turnaround of the business after a period of challenging trading”.
Poundland chief executive officer Barry Williams, who returned to the business in March this year, will remain under the new ownership.
Under the new ownership structure, Poundland will maintain its 800 stores in the UK and the Republic of Ireland. It will continue trading under the Poundland banner in the UK and the Dealz brand in Ireland and the Isle of Man. The retailer employs around 16,000 staff.
The transaction includes transitional services agreements between Pepco Group and Poundland for a finite period, covering IT services and procurement of clothing and general merchandise during the handover process.
Williams said: “Poundland is a UK and Ireland retailer of real significance, serving 20 million customers each year with a much-loved brand. Although recent trading has been challenging, we have built a turnaround plan with a simplified and more focused Poundland at its heart, as we aim to deliver the amazing value our customers expect.
“In due course, we’ll share more details of the proposed restructure and turnaround plan. I’d like to thank Pepco for its stewardship of the business. We welcome Gordon Brothers and look forward to working with them as we implement our turnaround plan.”
The sale represents a shift for Pepco Group, which announced in March its intention to refocus its retail operations under a single Pepco format centered on clothing and general merchandise.
Gordon Brothers head of Europe, the Middle East and Africa Mark Newton-Jones said: “We are delighted to provide Barry Williams and his management team with the financing to support the substantial turnaround of this iconic retailer. We believe Poundland is an essential business to UK consumers and plays an important role on the high street.”
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