The American owner of Poundland has warned that the high street discount chain remains "challenged and vulnerable", following discussions with government ministers about the retailer's future.
In a statement issued on Thursday morning, Gordon Brothers said it was still engaged in "active discussions" with potential buyers and was working to "protect as many jobs as possible" as the sale process continues.
The comments come a week after Poundland filed a notice of intention to appoint administrators, a move that placed the jobs of its roughly 12,000 employees in jeopardy. The filing granted the business 10 working days of protection from creditors while it attempts to secure a rescue deal before potentially falling into insolvency.
Gordon Brothers acquired Poundland only last year for a nominal sum of £1 and opened a sale process at the start of September. The restructuring specialist is now under pressure to accept a bid for the chain, which is close to collapse even though it has received solvent takeover offers. The Poundland board has appointed advisory firm AlixPartners to oversee the process after Gordon Brothers stopped providing funding.
On Wednesday, executives from Gordon Brothers and Poundland held separate meetings with government ministers to discuss the retailer's prospects. Advisers remain in contact with parties interested in acquiring the brand along with a substantial number of its stores, roughly two months after the formal sale process began.
A spokesperson for Gordon Brothers said on Thursday: "We are pursuing all avenues through the sale process to find a solution which protects as many jobs as possible and preserves value. Work continues at pace, engaging in active discussions on offers with interested parties. When Gordon Brothers acquired the business, it was in distress and required a radical restructure, urgent operational change and significant funding, which we provided to support the company's ability to trade."
The spokesperson added: "In spite of our efforts and the tremendous efforts of management to deliver a turnaround, the business remains challenged and vulnerable to any potential downturn in future trading. Our intent throughout the comprehensive sale process has been to protect as many jobs as possible and preserve value in order to deliver the best available outcome for the people, creditors and local communities who care about this business as much as we do."
Prime minister Andy Burnham said the owner must come forward with a "practical solution" to keep shops trading and safeguard employment. Asked what his message to Poundland's executives would be, Burnham said: "Focus on the people in your employment. Come up with a practical solution that saves jobs and saves those stores because many of them are viable propositions. They're on high streets. They matter in our communities. There is a solution to be found here. Sit down with us and let's find it." He added that the government was "prepared to find what we can do" to help rescue the chain.
Also on Thursday, suppliers who stand to lose millions of pounds should Poundland fail told the Guardian that the chain's American owner should not be allowed to maximise its own return at their expense.
