NEWS

Is Poundworld nearing a rescue deal?

Published on: 4th June 2018

Reports indicate Alteri Investors, which is backed by the private equity giant Apollo Management, is finalising the terms of a takeover of Poundworld.

As reported by Sky News, Alteri is closing on a rescue deal for Poundworld, at the start of a month which could determine the future of more than 20,000 high street workers.

A deal could be struck for a nominal sum with TPG, Poundworld’s current owner, and the retailer’s lenders by the middle of this week, sources said on Saturday.

As currently envisaged, it would be structured as a solvent takeover with all creditors being protected, they added.

If the deal does happen, Alteri is expected to launch a restructuring programme almost immediately that will lead to the closure of more than 100 Poundworld shops and the loss of about 1,500 jobs. In total, Poundworld employs about 5,300 staff.

Alteri’s expected takeover of Poundworld will – if its CVA is approved – lead to its store estate being reduced to around 250 shops with 4000-or-so employees.

TPG had initially been planning to undertake the CVA itself but decided against funding the company through that process. If the Alteri deal falls through, Poundworld will face insolvency.

Other prospective bidders have indicated to the chain’s advisers that they are only interested in acquiring parts of it through an administration process.

One source said that Alteri, which has seen Austin Reed and other British retailers such as Jones Bootmaker fail under its ownership, was determined to oversee a turnaround of Poundworld.

Poundworld will need to launch its CVA within about the next week to secure approval before the next rent-quarter day at the end of June.

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