Poundworld’s founder and former chief executive Chris Edwards has blamed TPG Capital for the retailer’s collapse, rejecting claims it was down to wider economic issues.
The discount chain’s most recent owners TPG, which bought the business from Edwards for £150 million in 2015, attributed its demise to a decline in the UK retail sector.
The private equity firm also placed blame on the poor value of the sterling after the Brexit referendum for Poundworld’s collapse into administration on June 11.
However, Edwards has put it down to “very bad” management from TPG, pointing the finger at their decision to hire staff with little experience in the discount sector.
“The new owners made expensive decisions that the business couldn’t take,” he said.
“They started recruiting people from supermarket backgrounds, who didn’t understand the discount, fixed-price model and with this they blew the firm’s wage structure.
“Then, they started selling multi-price products completely ignoring Poundworld’s USP, which was its amazing range of products that were all priced at just a pound.”
On Sunday it was revealed that Poundworld’s creditors were left £226 million out of pocket, with the administration providing just £22.8 million in the sales of assets which were taken up by preferential creditors and floating-charge holders.
The final Poundworld stores are due to shut on August 10 after numerous rescue bids, including an attempt by Edwards to buy 180 stores, failed.
Edwards went on to criticise administrators Deloitte, accusing them of slowing down the sales process to generate money from the liquidation of stock.
“In my opinion the administrator deliberately slowed down any potential sale of the business to generate more cash, with no thought for the jobs that would be lost,” he said.
“In the last seven weeks, I’d estimate the business turned over approximately £40 million and we’ll wait and see where this money ends up.”
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