Potential buyers of stricken retailer Wilko will have to invest up to £70m to rescue the firm.
PwC, the discount chain’s advisors, is in talks with a rival discount retailer and two private equity firms as it seeks to find a buyer so Wilko can avoid collapse, The Sunday Times reported.
Mike Ashley’s Frasers Group and Hilco – a lender to Wilko – are not in talks to buy the firm.
The £70m needed to be invested raises questions whether it will be possible to secure a solvent sale of the business.
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Around £25m to £30m of the funds is needed to get stock flowing through to Wilko’s stores and an additional £40m to pay off debts to Hilco, although the firm is willing to continue lending to the retailer.
Wilko filed a notice of intention to appoint administrators this week. The retailer was already looking for a buyer and had received a “significant level of interest, including indicative offers that we believe would meet all our financial criteria to recapitalise the business”, according to CEO Mark Jackson.
It is continuing talks and Jackson urged interested parties to “move as fast as possible” in order to secure a solvent sale.
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