B&M agrees to buy up to 51 Wilko stores for £13million
B&M has agreed to buy up to 51 Wilko stores from administrators for £13million.
The discount retailer has not confirmed which stores will be rescued in its deal, or if any jobs will be retained. Wilko had more than 400 stores and employed 12,500 people when it collapsed last month.
B&M said an update will be made in its half-year financial results, set to be published on November 9. In an update to its investors today, B&M said: "The consideration is fully funded from existing cash reserves and the acquisition is not expected to be conditional on any regulatory clearances."
Wilko administrators PricewaterhouseCoopers (PwC) said: "The joint administrators of the companies have today (5 September 2023) entered into an agreement to provide B&M with the option to acquire up to 51 properties after the administration trading period concludes at those sites."
It is understood that the majority of the stores will be rebranded as B&M stores. HMV owner Doug Putman has expressed interest in buying a chunk of Wilko stores, with Sky News reporting that he could snap up 200 branches instead of 300 that he was said to originally have been targeting. One source told the news site that Putman is now "reshaping the transaction" which means not as many stores will be saved in his rescue deal.
Wilko makes huge change to over 400 UK stores - and it's good for shoppers
During rescue talks, the HMV boss reportedly faced challenges from Wilko’s big suppliers that demanded their debt be repaid before supply lines were reopened to the retailer. Sky News said Putman remains in “constructive dialogue” with PwC regarding the "slimmed-down" deal although there was no certainty that an agreement would be reached.
This means that mass redundancies are still on the cards for Wilko staff, with the potential for thousands of jobs to be lost. GMB Union, who have been representing Wilko staff, has not yet issued a statement on the news.
Wilko was opened by founder James Kemsey 'JK' Wilkinson as a single store Leicester in 1930 and over the last 90 years, has grown into a staple of the high street. But the retailer - which took over most Woolworths stores - has struggled under mounting cost pressures in recent years.
It was famous for its pick and mix sweets and for selling just about anything from DIY supplies to garden and homeware goods, but its sales have steadily declined. The discount chain swung to a £35.9million loss in its year-end results, while last year saw Wilko close 13 stores from a planned 15 across the country. At the, it said this was the result of a number of leases coming to an end.
Retail experts suggested Wilko had failed to keep up with its cheaper rivals, with most of its stores based in expensive high street locations, as opposed to in retail parks and out-of-town locations. Cheaper prices at the likes of B&M, Home Bargains and The Range have also been blamed for its demise.
It had been reported last month that Wilko was exploring a sale of the business, as well as considering a company voluntary arrangement (CVA) to slash rents at stores. Wilko has already borrowed £40million from Hilco UK, specialist retail investor and lender which owns Homebase.
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