Poundland wins two more weeks of creditor protection as owner weighs three bids

Payroll will be paid in full this month, Gordon Brothers says

Poundland won two more weeks of protection from its creditors on Thursday while its US owner, the investment firm Gordon Brothers, weighs whether any of three bidders has enough funds to secure the budget chain’s survival.

The High Court approved the extension of legal protection — a moratorium — on Thursday morning. Poundland’s board said it had sought the extra time “with a view to identifying the best available prospects for shareholders, creditors and our people.” In a statement, the company said: “Our stores remain open as usual during this period and we thank our colleagues, suppliers and customers for their incredible and continued support.”

Gordon Brothers, which bought Poundland for a nominal £1 last year, backed the move. “We support the board’s decision to extend the legal moratorium over the company by a further 10 working days,” a spokesperson for the firm said. “This brings additional stability amid an ongoing sale process in the backdrop of increasing cost pressures and a difficult inflationary economic environment.”

The spokesperson said the decision allows the firm to confirm to Poundland employees that “funds will be released to allow payroll to be made in full this month,” while additional funds continue to be released to support the company’s ongoing trading.

Gordon Brothers said it is in discussions with three parties for a sale of the whole business and has also received several offers from established high street retailers for significant parts of it. “While our preference remains a sale of the whole company, we are taking due care to ensure that any successful offer can provide the funds required to acquire the business and see it through to sustainable cash generation,” the spokesperson said. “We, the board, and all involved are working to secure a credible plan that delivers certainty, preserves value and protects as many jobs as possible.”

Poundland, which operates 600 stores in the UK and Ireland and employs approximately 12,000 people, filed a notice of intention to appoint administrators two weeks ago. Gordon Brothers has since been under pressure to accept a bid that would save retail jobs and protect thousands of suppliers.

The firm confirmed it had provided £85m of financing, understood to be via an asset-backed loan that Poundland has only partially used over the past year. That financing is in addition to a £30m shareholder loan largely taken on by Gordon Brothers when it bought the business.

The court extension came after MPs accused Gordon Brothers on Wednesday of extracting millions of pounds from the retailer when it was on a “knife-edge”. Documents provided to MPs showed the firm had taken close to £20m in interest payments and various fees, including those relating to store closures, since acquiring Poundland.

Gordon Brothers said it had provided finance for Poundland “when no one else was willing to finance the company – and has contributed substantial efforts to support a turnaround”. Had it not done so, the firm said, “the company would have collapsed into insolvency in August 2025”. It added: “Our efforts have continuously focused on the company’s value and its people, not prioritising one over the other.”