Wilko store closures put on hold as administrators assess new bids

Wilko store closures put on hold as administrators assess new bids

30 Aug    Finance News, News

Wilko’s administrators have halted immediate redundancies for the chain’s 12,000-strong workforce amid claims from the staff union that bidders for the business have faced “difficulties” in negotiations.

PwC has put store closures on hold to further assess bids for the business after previously warning that job cuts could start this week.

The GMB union has called for the government to intervene because “jobs and livelihoods need to be prioritised as part of this process”. Andy Prendergast, the union’s national secretary, has written to Kemi Badenoch, the business secretary, saying the union was “devastated” when it learnt that consultations over job losses would begin soon because “the last significant bidder had dropped out”.

He said: “We were told by [PwC] that individual redundancy consultations would begin within a matter of days and that members would start to leave the business almost immediately.

“We wish to seek assurances from yourself that steps will be taken to guarantee that the administration process will be properly undertaken, that all bids will be considered, and that where possible all steps will be taken to protect jobs as part of this process.”

It is understood that there is now no set timeline for a decision on Wilko’s future. PwC said that it was “intent on achieving the best outcome for everyone involved”. The union has said that creditors should accept a “slightly worse deal” if it helps to save jobs.

A fresh rescue bid for the retail chain emerged on Sunday when M2 Capital, the private equity firm, confirmed that it had made a £90 million offer for the business. It pledged to retain all employees’ jobs for two years.

In emails seen by The Times, M2 Capital told PwC’s deal team that they were “putting a lot of obstacles and pressures” on the private equity firm.

PwC’s team have discussed M2 Capital’s bid on a video call but the private equity firm has not provided evidence of its funding position, despite several requests from the administrators.

M2 Capital has also been accused by PwC of breaching a non-disclosure agreement by providing details of the bid to the GMB union and journalists.

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Gareth Thomas, the shadow minister for international trade, said: “Ministers have run out of ideas to help Britain’s high streets. After 13 years we shouldn’t be relying on a knight in shining armour to ride to the rescue of such a key high street employer.”

James Naish, leader of Bassetlaw district council, where Wilko is based, said: “We continue to hope for the best for Wilko and its employees and are on hand to support in any way that we can with our local partners.

“We have been assured that employees will rightly hear meaningful updates first and directly. We trust this will be the case over the coming days as more details on any potential deals are understood.”

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