Friday, 27 April 2018

Discount retailer Poundworld adds to retail gloom

Discount retailer Poundworld is looking at closing about 100 of its 355 stores, putting up to 1,500 jobs at risk.

Poundworld is considering the move under an insolvency process called a Company Voluntary Arrangement (CVA).

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

Meanwhile, Carpetright's creditors and landlords have approved the company's CVA plan for about 80 closures, putting hundreds of job at risk.

CVA's have become a popular among retailers because they allow firms to offload underperforming stores and reduce rents while avoiding administration.
A number of retailers have chosen to go through a CVA, including New Look and Carpetright while last week House of Fraser said it was considering this measure as part of a number of options.

Earlier this year, both Toys R Us UK and electronics chain Maplin went into administration.

Poundworld is owned by private equity firm TPG Capital, which also controls the restaurant chain Prezzo whose landlords agreed to a CVA last month. Prezzo is also closing 94 branches.

BBC       News.

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