By Salma El-Sakka
UK Prime Minister Andy Burnham has urged Poundland’s US-based owners, Gordon Brothers, to work with the government to secure a future for the discount chain and its roughly 11,000 employees. The call came as Business Secretary Jonathan Reynolds prepared to meet Gordon Brothers this week amid mounting criticism of their handling of the retailer’s sale process.
Government pressure on Gordon Brothers
Poundland filed a notice to appoint administrators last week, putting the future of its stores at risk. Burnham, speaking during the Commonwealth Heads of Government meeting in Antigua, said the government was “prepared to find what we can do” to help save the chain. He told executives to “focus on the people in your employment” and “come up with a practical solution that saves jobs and saves those stores because many of them are viable propositions.”
Interest from rival retailers
Advisers are still in talks with several major supermarket chains interested in acquiring parts of the business. Tesco has held talks over proposals to buy up to 150 Poundland stores, while Poundstretcher owner Fortress has expressed interest in as many as 250 shops. Other grocery chains, including Iceland and Lidl, as well as Wilko and The Range owner CDS Superstores and B&M, have also shown interest in acquiring sites.
Nationalisation played down
Officials played down the prospect of the state taking over the discount chain. In the House of Lords, business minister Lord Leong declined to rule out nationalisation, but the Department for Business, Innovation, Science and Trade said he had “misspoken.” Downing Street has been critical of Gordon Brothers’ handling of the sale process, stating they appear “not acting in the best interests of their loyal UK staff and stores.”
Parliamentary scrutiny
The Commons Business, Innovation, Science and Trade Committee has requested that Gordon Brothers appear next week to answer questions about their actions. Business minister Kate Dearden is also due to hold talks with Poundland’s chief executive and chief finance officer.
