Business

Poundworld future in the balance after buyer pulls out

Poundworld shop Image copyright Getty Images

The future of struggling discount retailer Poundworld is in the balance after the main contender to buy the chain pulled out of talks.

Alteri Investors, whose website says it specialises in "challenging retail situations", was in advanced talks with Poundworld's owner TPG.

Poundworld's founder Chris Edwards is understood to be among other possible bidders for the 355-shop chain.

He sold out to TPG for £150m, and later took over at rival Poundstretcher.

Sky News, which revealed Alteri's move, said US firm Flacks, which expressed interest in Poundland, was no longer considered a contender.

About 100 of Poundworld's outlets were already under threat of closure. But this restructuring was put on hold by TPG, a US private equity firm, after it received expressions of interest in the company.

Poundworld, which employs about 5,300 people, is among many stores on the High Street which have been struggling.

Chris Edwards - Poundworld's saviour?

Image caption Poundworld featured in a BBC series Pound Shop Wars
  • Born into a "fairground family" Mr Edwards, 67, spent his early years travelling the UK
  • Founded Poundworld in 1974, and in the 1980s expanded into nightclubs
  • The retailer really took off "when a friend introduced us to importing from the Far East"
  • In 2015, Poundworld was sold to TPG Capital for £150m
  • In 2016, Mr Edwards was parachuted into Poundstretcher by owners Crown Crest to help revive the business. He left in April
  • He once said of the Poundworld sale that he was still "challenged by that decision" and whether it was the right move

Like many retailers, Poundworld has been hit by falling consumer confidence, rising overheads, the weaker pound and the growth of online shopping.

The chain imports a lot of its stock and is having to pay more for it because of the fall in the value of the pound.

Retailers Maplins, Toys 'R' Us, Mothercare, Carpetright, plus a string of restaurant chains, have hit the headlines this year because of trading trouble.

Department store chain House of Fraser is close to unveiling a restructuring, which could come as early as Wednesday.

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".

TPG, which bought a majority stake in Poundworld in 2015, also controls the restaurant chain Prezzo whose landlords and creditors agreed a restructuring last month.

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