Alteri closes in on troubled Poundworld

Budget retailer Poundworld is close to a rescue deal with private equity buyout fund Alteri Investors, in a move which could kick off a major reorganisation of the company.

Alteri, which is backed by Apollo Management, is finalising terms of a takeover according to Sky News.

The deal is set to involve a nominal sum being paid for Poundworld to TPG, its current owner, and creditors.

But the takeover is not expected to halt the plans to close as many as 100 stores. Once Alteri takes control it is expected to immediately launch the restructuring programme, the latest in a series of company voluntary arrangements (CVAs).

Some 1,500 of Poundworld's 5,300 staff are likely to lose their jobs as a result of the process.

This will add to thousands of closures on the high street so far this year, putting 2018 on course to be the worst year for closures since 2008.

House of Fraser is also on course to slash its portfolio, after announcing its own CVA. This is expected to launch in the next two weeks.

Meanwhile this week saw the approval of two more: Mothercare and Carluccio's.

But there are signs that the wave of CVAs is beginning to cause tension in the wider retail industry, with Next demanding rent cuts on par with its struggling neighbours and M&S joins the battle against rising high street rents.

[contf] [contfnew]

CityAM

[contfnewc] [contfnewc]