Poundland founder warns of prolonged job losses if retailer collapses
Founder Steve Smith urged the owners of Poundland to accept a buyout offer, saying the chain's 12,000 staff and thousands of suppliers could face years of unemployment if the company enters administration.
The founder of Poundland, Steve Smith, cautioned that the retailer's 12,000 employees could be out of work for an extended period if the company were to collapse. He appealed to the current owners, the US restructuring firm Gordon Brothers, to accept a proposed buyout from Northern Ireland’s Martin Property Group.
Smith, who launched the discount chain in 1990 and sold his remaining shares in 2006, said, "Once these jobs are lost, they are lost," and warned that the loss could affect not only store staff but also more than 2,000 suppliers linked to the business. He estimated that up to 30,000 jobs across the supply chain and high-street retailers might be at risk.
Poundland filed a notice of intention to appoint administrators at the High Court, securing protection from creditor claims until 12 November while a solution is sought. The advisory firm AlixPartners has been engaged to manage the process. Suppliers have already reduced deliveries, limiting the retailer's ability to trade.
The company's management is scheduled to meet Kate Dearden, the minister for the future of work, as political pressure mounts on Gordon Brothers to consider the Martin Property Group offer rather than proceeding with a breakup. The proposed deal would provide an upfront payment of about £7.5 million, with a matching amount deferred over two years, covering roughly half of the £30 million shareholder loan and assuming an additional £90 million asset-backed loan.
Gordon Brothers has so far declined the offer, despite Pepco, a former owner holding part of the debt, indicating willingness to wait for repayment in hopes of preserving the business. Gordon Brothers has not responded to requests for comment.