Poundworld has fallen into administration following the collapse of last-minute talks to save the discounter chain.
Talks with potential buyer RCapital collapsed over the weekend, putting around 5,100 jobs at risk.
The news was confirmed this morning in a statement from the appointed administrator Deloitte.
‘Like many high street retailers, Poundworld has suffered from high product cost inflation, decreasing footfall, weaker consumer confidence and an increasingly competitive discount retail market,’ the statement said.
It said the retailer would continue to trade while a buyer for all or part of the business was sought, with no immediate redundancies or store closures.
The business, headquartered in Normanton, near Wakefield in West Yorkshirre, currently has 335 stores, the statement added.
Clare Boardman, joint administrator, said: “The retail trading environment in the UK remains extremely challenging and Poundworld has been seeking to address this through a restructure of its business. Unfortunately, this has not been possible. We still believe a buyer can be found for the business or at least part of it and we are keeping staff appraised of developments as they happen. We thank all employees for their support at this difficult time.”
The collapse of talks with RCapital came after a potential deal with Alteri Investors, which specialises in challenging retail propositions, fell through last week.
Poundworld lost £17.1m in the year to 31 March 2017, up from £5.4m the year before, following restructuring costs and impairments on fixed assets.
Before the latest developments, 117 stores already faced threat of closure under the terms of a CVA restructuring plan revealed by The Grocer last month.