Poundland founder Steve Smith is pressing controlling owner Gordon Brothers to accept a rescue offer from Martin Property Group, warning that the retailer’s potential collapse could affect workers beyond its stores.
Smith told The Guardian that it could take a couple of years for workers to find jobs again. “Once these jobs are lost, they are lost,” he said. He estimated that up to 30,000 jobs across Poundland, its supply chain and other high-street businesses could be at risk. The retailer has more than 2,000 suppliers, some of which work only with Poundland, Smith said.
That estimate covers a wider group than the up-to-12,000 jobs potentially exposed at Poundland itself. The figure is not a confirmed redundancy count, as EconoTimes previously reported.
Poundland filed a notice of intention to appoint administrators on Oct. 29. The filing began a 10-business-day window to appoint an administrator; it did not put the retailer into administration. The window runs through Nov. 12.
The Guardian reported that Gordon Brothers rejected Martin Property Group’s proposal, though discussions continued. The offer included about £7.5 million upfront, about £7.5 million in payments over two years and the assumption of an asset-backed loan worth about £90 million. It would repay half of a £30 million shareholder loan. The Guardian also reported that Gordon Brothers was understood to believe a breakup of the business could raise more than the offer.
The Guardian reported that suppliers had held back deliveries, affecting Poundland’s ability to trade. The retailer’s management is due to meet Kate Dearden, minister for the future of work, on Wednesday, Nov. 4, the outlet reported.