Threat to jobs as group struggles

Market Place, Dewsbury.

It is understood that TPG and Poundworld’s management rejected offers to buy the business out of a pre-pack administration, and were hoping to sell it as a solvent business.

Poundworld’s losses widened in 2016-17 to £17.1 million, from £5.4 million of losses the year before.

Poundworld was founded as a market stall in Wakefield in 1974 by Chris Edwards. He built the business and ran it with son Chris junior before selling a majority stake for £150 million in 2015.

The retailer’s move would come just days after House of Fraser detailed its plans to shut 31 stores, affecting around 6,000 jobs. The Huddersfield branch of the store is not affected.

House of Fraser is seeking landlord approval for the restructuring plan, which is a form of insolvency known as a Company Voluntary Agreement (CVA).

A raft of CVAs have been struck in recent months as retailers struggle amid surging costs, rising business rates, competition from online rivals and a slowdown in consumer spending.

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

Restaurant businesses have also been seeking to cut their costs with store closure programmes, with Carluccio’s, Byron and Prezzo all pushing through CVAs this year.

The possible collapse of Poundworld comes after both Toys R Us and Maplin fell into administration earlier this year.

The Examiner reported last week that Huddersfield firm Buy It Direct (BID), based at Deighton, has made an undisclosed cash bid for the Maplin brand.

If the bid is successful, BID will set up a new Maplin-branded website – alongside existing sites such as AppliancesDirect.co.uk, LaptopsDirect.co.uk and Furniture123.co.uk – specialising in the sale of Smart home security products. It would create around 30 jobs.