Wilko is racing to secure fresh funding as it prepares to push ahead with its restructuring plan.
The struggling value retailer is working with advisers as it strives to raise tens of millions in additional equity.
It comes as Wilko works with property firm CBRE to pull together plans to undertake a CVA in order to reduce store rents.
The retailer and its advisers at PwC have approached a number of potential specialist distress investors this week for funds to support its plans, according to Sky News.
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It is thought that the new funding would result in the founding Wilkinson family diluting their shareholding.
Wilko secured a £40m asset-based credit facility from Hilco UK back in January, with the retailer’s intellectual property, including its logo, marketing slogans and various own-label product names, given over as security.
Despite the cash injection, the retailer has struggled to keep its stores fully stocked as credit insurance was withdrawn late last year.
Wilko chief executive Mark Jackson told the publication: “As directors, we continue to work through all the options available to the business, and in addition to the work we’re doing to streamline costs and transform the way we operate, we’re also now actively exploring opportunities to recapitalise the business and provide a stable platform to activate the next phase of the recovery, with a plan to maximise the significant opportunities that exist to re-establish a profitable Wilko.”
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5 Comments. Leave new
If the business does go under then any director within wilko’s should be banned from working in an influential position for the next 5 years within the retail industry. In addition any jobs lost apart from area management and above then no bonuses should be paid.
I could be wrong but I’m pretty sure if it does go under no one will be paid a single penny. No redundancy, no bonuses, no wages as all monies will be taken to pay their extremely high amount of debt off as much as possible. Someone please correct me if I’m wrong
All this is upper managements fault this is a disaster. A great company turned into mess.
The Wilko strategy needs to change to survive. Now, their range is too broad and too shallow. Some supermarkets, Poundland and Poundstrecher beating them for focus and width and depth of offer. Wilko needs some Jobs to be Done application to decide how they can deliver value for their chosen customers and differentiate themselves. Not worth struggling on unless they change, and quick.
I have seen first hand the demise of the company. Having over two decades of service I decided to jump ship before it went down. The truth isn’t in the public domain. The warehouses are at less than 10% capacity. £60m modernisation project failed miserably. Mismanagement and obvious bad decisions will lead to the downfall of what was once a strong respectable company. MTC and Peppa haven’t helped.