Poundland Secures Future with High Court Approval of Rescue Deal
Poundland has successfully avoided collapse as the High Court greenlit a rescue agreement today. The discount retailer sought court approval for a restructuring initiative that includes rent reductions and the closure of numerous stores and distribution hubs.
Facing a cash shortage that could lead to administration by the end of this week, Poundland’s plea for the plan’s endorsement was crucial. The go-ahead for the restructure triggers an infusion of up to £60 million in fresh funding to sustain the business.
Sir Alastair Norris, in authorizing the reorganization, stated, “I am approving the plan and will provide detailed reasoning later.” Poundland has already outlined the closure of 68 branches, with 11 shutting down permanently this Sunday, and another scheduled for early September.
Following its acquisition from Pepco Group for £1 by private equity firm Gordon Brothers in June, Poundland committed to injecting a total of £90 million into the business. Managing Director Barry Williams expressed gratitude for the court’s decision, emphasizing the stability it brings to the company, safeguarding numerous stores and jobs.
Despite acknowledging the impact on employees due to streamlining operations, Poundland aims to refocus on growth. Plans include renovating product ranges, reducing prices, and delivering a more customer-centric experience.
In a written submission to the court, it was revealed that Poundland’s financial condition had significantly worsened over the past two years, necessitating immediate action to avert a cash crisis by early September 2025. Poundland, established in 1990 in Burton upon Trent, Staffordshire, employs around 14,700 individuals across approximately 800 stores.
The restructuring plan, aside from store closures risking around 1,000 jobs, involves shutting down distribution sites in South Yorkshire and West Midlands. Further, Poundland will cease online sales through its website, impacting 350 employees associated with the affected warehouses.
Poundland’s legal team previously sought court permission for creditor meetings to vote on the restructuring strategy. After recent meetings, court approval is now sought to finalize the plans.
As part of the restructuring, Poundland revealed the closure of 12 additional stores, with the Irvine branch in Scotland set to shut on September 14. While 16 more closures are planned, their locations will be announced later this year.
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