Poundworld founder Chris Edwards is out of the running to rescue the troubled retail giant after negotiations stalled because his offer fell short of what the administrator hoped to achieve, despite him promising to save 3,000 jobs.
Edwards had tabled a deal to save 186 stores, along with 3,000 jobs, and last week revealed that despite contacting the administrator four weeks ago, his team was given access to Poundworld’s Normanton headquarters only a few days ago to assess stock levels, and begin talks with the company’s bank Santander.
Edwards said: “I’ve made a substantial and credible offer, which is the best offer we can put forward, but in my opinion, it hasn’t been given the respect it deserves. Although it was close to what the administrator wants, we’ve now had written confirmation that it’s not high enough, which I’m shocked and surprised at, considering we were going to save 3,000 jobs.
“You have to consider the moral argument in this and the fact that people’s livelihoods are on the line and clearly to some people it appears that doesn’t matter. Instead it seems that selling off all the stock and closing the stores is a better option.
“The amount of extra money the administrator is holding out for is a drop in the ocean when you consider how much money will be needed to stabilise the business and replenish stock levels, which is where the real costs will be incurred, and that’s why we can’t increase our offer.
“I now believe the business will close rather than jobs being saved. The administrator has informed us they are working in the best interests of creditors, and I still say it will be interesting to see how much cash is left after the administrator’s fees and wages, especially because their fee is increasing with each day that passes.”
Edwards started Poundworld on a Wakefield market stall in 1974 and built it into a leading high street brand, with more than 300 stores across the UK, selling a vast range of products that were all priced at a pound. US private equity firm TPG acquired a majority stake in the business in 2015, but the company called in administrators earlier this month.