Wilko Faces Store Closures as HMV Owner’s Rescue Talks Collapse
In a significant setback for Wilko, rescue negotiations aimed at saving the majority of the chain have faltered between Doug Putman, the proprietor of HMV, and administrators PWC.
The GMB union has voiced concerns, indicating that it is highly probable the chain will cease operations next month, resulting in all employees facing redundancy. The union has also criticized the management of the business, suggesting that it should have thrived in an environment emphasizing discounts.
Initially, there were high hopes that Doug Putman, renowned for his successful revitalization of HMV, would acquire as many as 300 out of the chain’s 400 stores. However, this number was later reduced to 200, and as recently as Thursday, there were speculations about the potential rescue of a quarter of the chain.
Reports suggest that the breakdown in talks was primarily due to concerns related to the costs associated with assuming control of the chain’s existing infrastructure.
It is now anticipated that PWC might strike a deal with Pepco, the owner of Poundland, to acquire up to 100 of the Wilko stores. Notably, 51 of the stores have already been sold to the rival value retailer, B&M.
The fate of the company in its current form remains uncertain, and it is unclear whether any potential deals for the stores would include retaining the current Wilko staff.
Before entering administration, Wilko employed 12,500 people, and although some redundancies have already occurred, the potential for mass layoffs in the thousands looms, significantly impacting the retail sector, reminiscent of the challenges faced following the collapses of BHS and later Arcadia.