Discount retailer sold to Gordon Brothers for nominal fee as restructuring plan sees 68 locations earmarked for closure
Poundland will close another 25 stores across Britain in August, dealing a fresh blow to high streets already reeling from waves of retail closures in recent years.
The discount chain, which was sold to investment firm Gordon Brothers for just £1 in June, will shut locations on two separate days next month – August 10 and August 17. The closures form part of a wider restructuring plan that will ultimately see 68 Poundland stores disappear from UK high streets.
Former parent company Pepco Group agreed to the nominal sale price after the retailer struggled with falling sales and mounting losses amid what it described as an “increasingly challenging UK retail landscape.
Stores Set for Closure
Ten stores will close on August 10, including locations in Birmingham Fort, Cardiff Valegate, Leicester, and Shrewsbury. A further 15 stores will shut their doors on August 17, affecting areas from Bedford to Worcester.
The full list includes branches in Ammanford, Cramlington, Long Eaton, Port Glasgow, Seaham, and Tunbridge Wells closing on August 10, whilst Bidston Moss, Broxburn, Craigavon, Dartmouth, East Dulwich, Falmouth, Hull St Andrews, Newtonabbey, Perth, Poole, Sunderland, Stafford, and Thornaby will close on August 17.
Three Poundland stores have already shut as part of the restructuring, including Swiss Cottage in April 2024, Chiswick in May 2025, and Southampton West Quay in June 2025.
£80 Million War Chest
Gordon Brothers acquired the struggling retailer for a nominal €1 (85p) in June, along with substantial liabilities and the commitment to inject fresh capital. The investment firm is providing up to £80 million in financing for the “proposed restructuring and turnaround of the business after a period of challenging trading”.
Pepco Group is also supporting the business by rolling over an existing secured loan of £30 million and providing an overdraft facility of up to £30 million, which will become available upon completion of the restructuring plan.
Mark Newton-Jones, head of Europe, the Middle East and Africa at Gordon Brothers, said: “We are delighted to provide Barry Williams and his management team with the financing to support the substantial turnaround of this iconic retailer.”
“We believe Poundland is an essential business to UK consumers and plays an important role on the high street.”
Falling Sales Prompt Action
The sale came after Poundland’s like-for-like sales fell 7.3 per cent in the three months to December 31, 2024. Despite generating revenues of more than €2 billion (£1.67 billion) in 2024, the retailer faced mounting pressure from rising costs and fierce competition.
Pepco Group CEO Stephan Borchert said: “The agreed sale of Poundland marks an important milestone in our strategic plan to move away from FMCG and focus predominantly on Pepco, our higher margin clothing and general merchandise business.
The company cited several factors behind Poundland’s struggles, including “a more difficult sales environment and consumer backdrop in the UK, alongside margin pressure and an increasingly higher operating cost environment.
Industry sources had suggested the chain could be sold for “effectively a pound” due to the extensive work required to turn the business around. The retailer operates approximately 825 stores and employs around 16,000 staff across the UK and Ireland.
Impact on Staff
Poundland’s retail director, Darren MacDonald, acknowledged the difficult nature of the closures. It is of course, sincerely regrettable that our recovery plans include any store closures, but sadly that’s necessary if we’re to achieve our goal of securing the future of thousands of jobs and hundreds of stores.
“While our anticipated network of around 650-700 stores remains a sizeable one, we entirely understand how disappointing it will be for customers when one nearby closes.”
He added that the company would work closely with affected colleagues through a formal consultation process, exploring suitable alternative roles where possible.
The remaining 40 stores identified for closure are expected to shut on a rolling basis between August 10 and mid-October, though specific dates have not been confirmed.
Wider High Street Challenges
The Poundland closures come against a backdrop of ongoing challenges for British retail. According to data compiled by PwC, store closures fell to 12,804 in 2024 – around 35 per day – representing the second lowest rate of closures in a decade.
In comparison, there were 9,002 openings over the year, averaging 25 daily. The net decline shrank to -1.8 per cent in 2024, with smaller declines in almost all types of outlets.
Jacqueline Windsor, head of retail at PwC UK, struck a cautiously optimistic tone about the sector’s prospects. “Our latest Store Openings and Closures insights indicate a cautious optimism for the retail sector. This creates opportunities for stakeholders to seize momentum and unlock growth by tackling market challenges and capitalising on evolving consumer behaviours.”
“Whether it be investing in technology to enhance the consumer experience or drive productivity improvements, 2025 could be a big year for retailers who are smart about how they play in the market.”
Strategic Missteps
Poundland’s troubles have been partly attributed to strategic decisions made under Pepco’s ownership since 2016. The company moved away from its iconic “everything’s a pound” pricing model in 2017, following the UK’s Brexit vote.
More recently, Pepco’s decision to replace Poundland’s clothing and homeware ranges with products from its continental European business proved disastrous, leading to what the company described as “gaps in clothing and general merchandise for the UK customer, impacting revenues and profitability”.
Barry Williams, who previously served as Poundland’s managing director, returned to lead the business in March 2025 and is spearheading the turnaround programme.
The business will continue to operate under the Poundland brand in the United Kingdom and under the Dealz brand in the Isle of Man and Republic of Ireland, with Pepco Group expected to retain a minority investment.
As the August closures approach, the focus remains on whether Gordon Brothers’ restructuring plan can restore the fortunes of what was once one of Britain’s most successful discount retailers.
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