The billionaire business tycoon behind HMV could save up to 4,000 jobs at collapsed retailer Wilko in an eleventh-hour rescue bid.
Doug Putman, 39, who owns the British CD seller and Canada’s largest toy business Toys R Us, was last night in talks with administrators to buy part of the business.
He has proposed to keep around 200 of its 400 shops and between 3,000 and 4,000 of its 12,000 staff. The deal would also mean the survival of the Wilko brand.
Administrators are set to work through the weekend to analyse a final bid from Mr Putman, in order to secure the best outcome for creditors and staff.
The retail chain’s profits plummeted by £38.7 million last year as sales fell by 3.3 per cent to £1.2 billion, and with profits taking a blow from rising inflation.
Retail mogul Doug Putman, 39, whose firm, Sunrise Records, bought HMV in 2019, is understood to currently be in talks with Wilko bosses
The retail chain’s profits plummeted by £38.7 million last year as sales fell by 3.3 per cent to £1.2 billion, and with profits taking a blow from rising inflation.
The 93-year-old chain tumbled into administration this month and administrators at PwC have been poring over potential rescue bids.
Mr Putman is believed to have flown into the UK for rescue talks, with sources claiming that his management team had been spotted at Wilko headquarters in Worksop, Nottinghamshire.
One source told The Times: ‘There have been long, long meetings, so he’s been working round the clock by the looks of things.’
Mr Putman has allegedly brought forward an offer which cut down Wilko branches by half and keep 3,000 to 4,000 of its 12,000 members of staff.
PwC administrators, who were also included in the talks along with Wilko’s chief executive Mark Jackson, on Wednesday said there were no offers for the entire group but insisted discussions continue ‘with those interested in buying parts of the business’.
Although there was some speculation that a stock liquidation, which would see Wilko’s inventory sold for a huge discount, was the preferred outcome by those looking at bids, administrators insisted that talks with buyers continued.
A PwC spokesman said: ‘Since our appointment we have worked relentlessly to secure a sale of the business, and talks are continuing with a number of parties.
‘As administrators we’re intent on achieving the best outcome for everyone involved while preserving as many jobs as possible and adhering to our statutory duty to act in the best interests of the creditors as a whole.’
Mr Putman has allegedly brought forward an offer which cut down Wilko branches by half and keep 3,000 to 4,000 of its 12,000 members of staff
Although there was some speculation that a stock liquidation, which would see Wilko’s inventory sold for a huge discount, was the preferred outcome by those looking at bids, administrators insisted that talks with buyers continued
PwC also said in a statement yesterday: ‘While discussions continue with those interested in buying parts of the business, it’s clear that the nature of this interest is not focused on the whole group.
‘Sadly, it is therefore likely that there will be redundancies and store closures in the future and it has today been necessary to update employee representatives.’
Andy Prendergast, the GMB national secretary, who are representing Wilko workers, warned that there were likely to be significant job losses and stated that they would ‘fight to ensure Wilko bosses are held accountable for the simple reason our members deserve so much better’.
A source at Wilko told The Times: ‘It’s just frustrating because there’s 12,000 of us who are now going to lose our jobs.’
If the Putman bid is rejected, some stores could still be sold to other bidders.
Potential buyers are thought to include Poundland, The Range, Home Bargains and rival B&M European Value Retail, who have reportedly expressed interest in taking some shops, but are expected to drop the Wilko brand.
Mr Putman’s firm, Sunrise Records, bought HMV in 2019 restoring it to its former glory, bringing back its profits.
The music retailer now boasts almost 120 shops and is planning to reopen its flagship on Oxford Street in the West End of London.
Wilko founded in 1930 as a hardware shop in Leicester by James Kemsey Wilkinson, and was known as Wilkinson before becoming ‘Wilko’ in the early 2010s – grew to rule the British high street as the leading discount store.
Over the years the family-owned firm expanded its range to include DIY products, gardening wares and general home goods. But it has faced fierce competition from cut-price competitors and online rivals like Amazon.
It struggled in the face of lockdowns to emerge from the pandemic only to be battered by rampant inflation.
Wilko founded in 1930 as a hardware shop in Leicester by James Kemsey Wilkinson, and was known as Wilkinson before becoming ‘Wilko’ in the early 2010s – grew to rule the British high street as the leading discount store
After Lisa Wilkinson, the founder’s granddaughter, stood down as chairwoman in January this year – warning that the business could run out of cash – the retailer scrambled to prop up the business with a new chair and £40 of borrowed cash from the creditor Hilco.
Hilco has previously owned HMV before it went bust and was also involved in the closure of high-street department store, Debenhams
Ms Wilkinson was replaced by Chris Howell, the former chairman of Bensons for Beds.
The collapse of Wilko marks another dark day for the High Street following the near-disappearance of newsagent McColl’s last year before its rescue by Morrisons.
In recent years, Britain’s high streets have lost popular names such as Debenhams, Topshop owner Arcadia group and Mothercare.
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