High street discounter Poundland, which has six stores in our region, has filed to appoint administrators, threatening the future of around 12,000 workers.
Court filings show that the retailer has filed a notice of intention to appoint administrators on Thursday afternoon, which will give the business 10 working days of breathing space from creditors to secure a potential rescue deal.
Advisers are still in talks with parties interested in buying the brand and swathes of stores.
In York and North Yorkshire, branches are at Low Petergate, York; Victoria Shopping Centre, Harrogate; Abbey Walk Retail Park, Selby; Flowergate, Whitby; Westborough, Scarborough and The Promenades, Bridlington.
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A statement from the Poundland board said this afternoon: “Over the past two months, initially prompted by interest from several parties, we have been working on a formal sale process for Poundland.
"Despite enormous efforts it has not been possible to identify an acceptable offer for the business as a whole.
"The process has however attracted several established retail operators who have made formal offers, collectively these cover a significant part of the business, and we believe offer the best available prospects for shareholders, creditors and to preserve jobs.
"We recognise any sale process creates uncertainty and particularly when set against a challenging UK economic environment. We thank all stakeholders, and in particular our people for their support during this period.
"In order to bring stability, we have today filed a Notice Of Intention (NOI) to appoint representatives of AlixPartners as Administrators to the business.
"The filing of the NOI creates an immediate ten working day legal moratorium during which we will be working closely with our advisors to identify and deliver the best possible outcome.
"Our stores remain open as normal, and we thank our staff, suppliers and customers for their continued support.”
Poundland stressed that all its stores remain open and trading as normal despite the insolvency process.
It comes after owner Gordon Brothers rejected a takeover offer from Irish real estate firm Martin Property Group, which management named as their preferred bidder earlier this month.
Gordon Brothers – which only bought Poundland last year for £1 – launched a sale process for the retailer at the start of September.
Poundland currently runs around 600 stores across the UK.
Wilko and The Range owner CDS Superstores, Poundstretcher owner Fortress and TG Jones owner Modella are all understood to be interested in buying parts of the Poundland business.
Other retailers including B&M, Lidl and Aldi are also reportedly interested in buying stores.
However, deals are unlikely to include all Poundland stores and some jobs are likely to be impacted.
Gordon Brothers had overseen a major turnaround programme at Poundland which had already resulted in the firm shutting more than 100 shops over the past year in an effort to shore up its finances.
However, the impending insolvency comes amid reports of increasing friction between Gordon Brothers and Poundland management.
The owners rejected the solvent takeover bid from Martin partly due to expectations that bidders stump up £30 million to cover a loan Gordon Brothers took on from its takeover last year.
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