Wilko’s administrators have been urged to accept a rescue deal for the ailing value chain after receiving a second last-minute bid.
M2 Capital, an Anglo-Canadian restructuring specialist, is understood to have put forward a bid worth £90m that would keep the entire retailer trading, The Guardian reported.
It comes days after HMV owner Doug Putman made a surprise last-minute offer that would see 350 out of the 400 stores remain open and the £40m worth of debts owed to Hilco paid off.
Putman submitted an improved proposal on Friday after administrators PwC dismissed his earlier bids.
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According to Sky News, the Canadian tycoon has approached several debt providers including Gordon Brothers and Hilco to help finance his offer.
City sources told the publication that a rescue deal with Putman was “unlikely” but that it remained under discussion with PwC, with a decision likely to be made at the start of next week.
If his bid is unsuccessful, Wilko will be broken up with 150 stores sold to rivals Poundland and B&M.
Fellow value retailer The Range is understood to be in pole position to acquire Wilko’s brand and online operations.
Wilko plunged into administration at the start of the month after teetering on the brink of collapse for several months.
Former Wilko managing director Gordon Brown accused the chain’s owner Lisa Wilkinson of pushing the retailer to the edge by scrapping its tried-and-tested low price strategy.
Brown, who led the business between 1992 and 2007, told The Mail on Sunday: “Wilko was a convenience store where you went to buy bits and pieces for your house for a low price.”
He said the management team under Wilkinson “got into a situation where they were not following their successful model of low price, low cost”.
“They paid consultants who helped them bring about a new format for stores, but they were less aggressive on pricing and their approach on the shop floor.”
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4 Comments. Leave new
The Wilkinson family took £77 million out of the ailing business over the last decade.
The Wilkinson family paid themselves multiple million pound dividends each year during the covid crisis while revenues fell and debts rose.
The Wilkinson family hurriedly sold off their main distribution centre to rent it back earlier this year for a staggering c£50m below its market rate.
The Wilkinson family according to numerous insiders bizarrely refused to acknowledge that the likes of B&M, Home Bargains, Poundland, or Poundstretcher as their main competitors instead comparing themselves with premium retailers.
While few are stating it’s solely the Wilkinson family’s fault this sorry state of affairs occurred, the bulk of the blame for their company’s failure lies with the current Wilkinson family’s business lead, Lisa Wilkinson, and to suggest otherwise is at best, deeply disingenuous and speaks volumes.
Oh dear, private equity. Given this late stage, seems almost more sensible to let it die. There is very little
stock in this business. Hopefully those interested retail parties (split between B&M, Poundland, and The Range) may be able to salvage and transform the stores that work, saving some of those jobs affected along the way. Certainly seems a more viable, longer term solution. PE will likely jisy limp it on for a few years, before we repeat this whole sorry process.
I sincerely hope that Wilko is saved! With the cost of living crisis, Wilko has been a lifeline for many. The prices are affordable; especially when it comes to washing powders etc. Sure, you have the cheaper shops, but a lot of their goods are not branded and are sometimes of lesser quality.
Yes , sell the stores that have a commercial future so secure the future of those store teams .
Otherwise it will be the same scenario in 18months then everything goes