By Sohaib Shams
Prime Minister Andy Burnham has called on Poundland’s US-based owners, Gordon Brothers, to work with the government to secure a future for the discount chain and protect roughly 11,000 jobs. The retailer filed a notice to appoint administrators last week, putting its stores at risk of collapse.
Government pressure on Gordon Brothers
Business Secretary Jonathan Reynolds is set to meet Gordon Brothers this week amid criticism of their handling of the sale process. Burnham said the government is “prepared to find what we can do” to help save the chain, urging executives to “come up with a practical solution that saves jobs and saves those stores.” He added that many outlets are viable and matter to local communities.
Potential buyers emerge
Several parties have expressed interest in acquiring parts of the business. Investment group Xyra, backed by veteran businessman Andrew Brode, has proposed a £12.5 million upfront payment. Tesco has held talks to buy up to 150 stores, while Fortress, owner of Poundstretcher, is interested in as many as 250 shops. Other grocery chains including Iceland, Lidl, Wilko, The Range owner CDS Superstores, and B&M are also reported to be in the frame.
Nationalisation ruled out
Officials played down the prospect of a state takeover after business minister Lord Leong declined to rule out nationalisation in the House of Lords. The Department for Business, Innovation, Science and Trade said Lord Leong had “misspoken,” and Downing Street has been critical of Gordon Brothers’ actions, stating they do not appear to be acting in the best interests of staff.
Parliamentary scrutiny
The Commons Business, Innovation, Science and Trade Committee has requested that Gordon Brothers appear next week to answer questions about the sale process. Business minister Kate Dearden is also due to hold talks with Poundland’s chief executive and chief finance officer.
