B&M said this morning it had agreed to pay up to £13m from existing cash reserves for the stores, with an update on when they will open to be provided in its first-half results in November.
B&M has not said whether Wilko staff will retain their jobs at the stores, which it is likely to covert to its own fascia. It indicated a further announcement may follow this afternoon.
In an update for workers following a meeting with administrators at PwC, GMB union warned the deal for 51 stores “would appear to be for store premises only”.
“This would mean that whilst new brands may open on site, workers would not transfer to these,” the union said. “Instead, they would be made redundant by the administrators prior to any store closure.
“We are making enquiries about the possibility of current staff being given preferential treatment in applying for any jobs that may appear, but at time of writing we cannot confirm these will apply.”
The deal has been taken as a sign that a rescue of Wilko’s other 350 stores and brand is unlikely. Reports suggest HMV owner Doug Putman, who had tabled a deal to buy 300 stores, is now in talks over 200 instead. Putman’s initial rescue bid is said to have run into problems as major suppliers demanded debts were repaid before supplying stores, The Sun reported.
GMB said PwC were “continuing to work with one bidder who has made an offer for a significant part of business”.
M2 Capital, which last week offered hope to Wilko’s 12,500 employees in an offer to buy the whole chain, did not provide administrators with requested details of financing within the deadline. Redundancies at Wilko’s support centre and distribution centres began this week after the bid fell through.
Wilko entered administration on 10 August, after failed attempts to find a buyer for the 93-year-old discounter. The retailer was in the midst of a turnaround plan aimed at cutting costs and growing online sales.
In the months leading to its collapse, it sold its Worksop distribution centre for £48m and secured a £40m two-year revolving credit facility from lender and Homebase owner Hilco UK. It had also hoped to launch a company voluntary arrangement, a restructuring process involving reduced rents for stores.
Lisa Wilkinson, granddaughter of Wilko founder James Kemsey Wilkinson and major shareholder of the retail chain, stepped aside as chair in January.