Poundland founder warns of long-term job losses if retailer fails

Poundland, currently controlled by US restructuring specialists Gordon Brothers, recently filed a notice of intention to appoint administrators at the High Court. This measure provides temporary protection from creditor demands until November 12th, but the retailer’s future remains precarious due to disruptions in supply deliveries.

Management is scheduled to meet with Kate Dearden, the minister for the future of work, on Wednesday amid increasing pressure on Gordon Brothers to accept a buyout offer from Martin Property Group, based in Northern Ireland. Gordon Brothers reportedly believes a breakup of Poundland could yield higher returns than the Martin offer.

Smith, who sold his remaining shares in 2006 for £250 million, stated he is willing to support the Martin Property Group offer, though his financial contribution isn’t required. He expressed disappointment at not having his previous bid acknowledged. “If they have got offers on the table, why is Gordon Brothers not taking it and saving all these people?” he asked.

Beyond the 12,000 employees directly employed by Poundland, Smith highlighted the potential impact on over 2,000 suppliers, some of whom rely solely on the retailer. He estimates that up to 30,000 jobs across the supply chain and related businesses could be at risk.

Martin Property Group’s proposed deal includes an initial payment of approximately £7.5 million, with a further £7.5 million in deferred payments over two years, alongside an asset-backed loan of about £90 million. Pepco, a former owner holding a portion of Poundland’s debt, is reportedly willing to delay repayment to preserve the business. Gordon Brothers has not yet responded to requests for comment.