wilko store front high street GettyImages-1516209644

Source: Getty Images

Wilko has 400 stores across the UK

Wilko intends to appoint administrators, potentially putting 12,000 jobs at risk.

The family-owned home and garden retailer, which has 400 stores across the UK, has been attempting to sell a majority stake, working with PwC as advisors, after plans earlier this year to launch a company voluntary arrangement (CVA) stalled.

Wilko CEO Mark Jackson said the business had so far failed to secure any offer that would save it from running out of cash.

“While we can confirm we’ve had a significant level of interest, including indicative offers that we believe would meet all our financial criteria to recapitalise the business, at present, we don’t today have an offer that provides the necessary liquidity in the time we have available, given the mounting cash pressures we’re faced with,” he said.

Wilko files to appoint administrators 

“Unfortunately, with this in mind, today we’re having to take the difficult decision to file a notice of intention to appoint administrators.

“We’ll continue to progress discussions with interested parties with the aim of completing a transaction which preserves the business and will encourage those interested parties we’re in discussions with to move as fast as possible.”

Wilko had hoped to secure rent reductions on 250 stores in a CVA that was due to launch around June, but landlords had been expected to reject the terms, which for some would have included forgoing rent for three years.

In July, Wilko said it was looking to recapitalise the business by securing new equity, having already secured a £40m two-year revolving credit facility with lender and Homebase owner Hilco UK in January.

Wilko bosses continue to believe in a turnaround plan

Wilko also launched a turnaround programme aimed at slashing costs in January, including the loss of one in four head office roles and hundreds of store roles.

Jackson added: “We continue to believe that our robust turnaround plan, with significant re-stabilisation cost savings in progress, will deliver a profitable Wilko and maximise the significant opportunities that we know exist.

“We’re a £1.2bn turnover business with strong presence on UK high streets through our 400 stores, online at wilko.com and through our great value Wilko own-brand products, serving local communities with their everyday household and garden needs for over 90 years.

“That said, while we’ll continue to progress these indicative offers, without the surety of a recapitalisation being able to be completed within the necessary timeframe and given the cash position, we’ve been left with no choice but to take this action.”