Poundworld falls into administration, putting 5,000 jobs at risk

Poundworld falls into administration, putting 5,000 jobs at risk

Poundworld, which is owned by TPG Capital, has 335 stores in the United Kingdom and employs around 5,100 people.

The demise of Poundworld follows the collapse into administration earlier this year of both high street electronics firm Maplin and Toys R Us.

Deloitte, which has been co-ordinating efforts to find a solvent deal for the business, is expected to oversee the administration of Poundworld.

Deloittte has confirmed that it has been appointed after last-ditch rescue talks with potential buyer R Capital broke down over the weekend.

Other parties named as possible buyers were turnaround specialist Alteri Investors and Poundworld's founder Chris Edwards.

Deloitte said Poundworld would trade as usual while it seeks a buyer for all or part of the business, adding that no redundancies or store closures are yet planned.

'Unfortunately, this has not been possible.

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Poundworld, which has its headquarters in West Yorkshire, was formed in 2004, but it says it can trace its origins "back to 1974 and a market stall in Wakefield, West Yorkshire".

It also comes just days after department store chain House of Fraser outlined plans to close 31 of its 59 stores - including its flagship Oxford Street outlet - affecting a total of 6,000 jobs.

Poundworld's losses widened in 2016-17 to £17.1 million, from £5.4m of losses the year before.The retailer was hit with a £5.7 million charge for onerous leases, a provision retailers make when the cost of a lease is no longer covered by the income of the store.

The news comes hot on the heels of House of Fraser revealing it was to close more than half of its United Kingdom stores in a bid to make it viable.

Other retailers undertaking CVAs in a bid to keep trading include New Look, Mothercare and Carpetright.

Deloitte said there are no redundancies or store closures now and has been working alongside the company in a bid to keep it afloat.

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