Pepco has completed a sale of Poundland to Gordon Brothers.
An announcement this morning confirmed the group sold the shares in the struggling discounter for a nominal sum.
Poundland MD Barry Williams will continue to lead the business under the new ownership of the retail-focused investment firm.
As part of the deal, Gordon Brothers and Pepco have agreed to put forward a restructuring plan, with further detail to be announced by Poundland in “due course”.
If the proposed restructuring gets the go-ahead from the High Court, Pepco expects to obtain a minority investment stake in the Poundland Group.
Pepco will also continue to provide “certain services” to Poundland for a transition period, including the procurement of clothing and general merchandise.
A more agile Poundland
Warsaw-listed Pepco said the sale of Poundland simplified its structure and created “a cleaner, more agile business”, enabling the group to focus on expanding its core higher-growth, higher-margin Pepco brand.
“The agreed sale of Poundland marks an important milestone in our strategic plan to move away from fmcg and focus predominantly on Pepco, our higher-margin clothing and general merchandise business,” CEO Stephan Borchert added.
“As set out during our Capital Markets Day in March 2025, this transaction will strongly support our accelerated value creation programme by simplifying the group and focusing on our successful Pepco business. I am confident that Pepco has the right foundations to be one of Europe’s most successful discount retailers, delivering customer satisfaction, profitable growth and shareholder value.
“Poundland remains a key player in UK discount retail, with millions of customers annually and a well-loved brand and proposition. We want to sincerely thank all the Poundland team for their ongoing commitment and contribution to the group and wish Barry Williams and his team all the best for the future.”
Pepco’s secured loan of £30m and certain unsecured loans will remain in place between the group and Poundland as part of the deal, with the former owner to put an overdraft of up to £30m in place upon completion of the proposed restructuring to support the transaction.
Pepco put Poundland up for sale in March after the variety discounter’s weak trading led to a £650m writedown on the group’s balance sheet.
The group’s first-half results last month revealed Poundland revenues tumbled 6.5% to £985m in the six months to 31 March, as poor trading continued from last year.
More than 100 Poundland stores were expected to close as part of a deal with a new owner, but this has yet to be confirmed.
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