Struggling discount retail chain Poundland has sold for just £1 to US investment giant the Gordon Brothers (former owner of Laura Ashley), who will attempt to save the chain with an £80m investment.

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Poundland was put up for sale by its owners, the Poland-based Pepco Group, in March as a result of “challenging trading conditions” and operating in a ”retail landscape that is only intensifying”. Before finalizing the milestone deal, Pepco reportedly received several other offers, including one from Hilco and Modella Capital, the new owners of WH Smith’s high street business. Stephan Borchert, the chief executive of Pepco Group, which bought Poundland in 2016, stated the sale:

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 “marks an important milestone in our strategic plan to move away from FMCG [fast-moving consumer goods] and focus predominantly on Pepco, our higher margin clothing and general merchandise business”.

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Poundland currently has over 825 outlets and employs roughly 16,000 people, but has been challenged by rising wage costs and mounting competition by other discount shops. Whilst the milestone deal was about preserving the 35-year-old brand rather than generating an immediate profit, job losses and store closures have been announced as likely imminent. Despite Poundland having millions of customers each year, 

consumer expert Kate Hardcastle said a sale for a nominal amount "often signals a business model that has struggled to keep pace with market forces…In this case, it reflects not just internal challenges but profound shifts in how consumers now shop…”

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She added: Brands such as Temu and Shein have "fundamentally changed consumer expectations around price, speed and convenience".

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Pepco have shared that following Poundlands sale the business will continue to be led by managing director Barry Williams.

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Borchert added:

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"We want to sincerely thank all the Poundland team for their ongoing commitment and contribution to the group and wish Barry Williams and his team all the best for the future”.

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