Poundland has extended its legal moratorium by ten working days as its board works to resolve ownership uncertainty and secure a going-concern sale.
Its owner, Gordon Brothers, said it will release enough funding for the company to pay staff in full this month and to keep supporting its trading operations.
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According to a Sky News report, the owner has been accused of pushing the retailer close to collapse even as its profitability was improving.
The accusations include rejecting offers for the business and its store estate.
Gordon Brothers had earlier put in £10m ($13.2m), reportedly after blocking management’s access to funds, a step that had endangered operational functions.
The extension follows the lapse of an initial notice to appoint administrators.
Poundland operates about 600 stores and has 10,500 employees. Gordon Brothers bought the chain for €1 ($1.11) more than a year ago.
Poundland’s board, cited by the publication, said: “Our stores remain open as usual during this period, and we thank our colleagues, suppliers and customers for their incredible and continued support.”
The matter was raised at a closed-door meeting between Poundland executives and Parliament’s business committee.
The committee chair accused the US investment firm of “behaving almost like a Wolf of Wall Street”.
In a memo to staff, Poundland managing director Barry Williams said the earlier funding had allowed only “limited” stock replenishment, though more money had since been made available.
Gordon Brothers told Sky News: “We support the board’s decision to extend the legal moratorium over the company by a further ten working days.
“This brings additional stability amid an ongoing sale process in the backdrop of increasing cost pressures and a difficult inflationary economic environment.”
The uncertainty surrounding Poundland comes amid rising operating costs, intensifying competition and changing consumer behaviour across the UK retail sector.
The retailer’s difficulties highlight the pressures facing discount chains and raise wider questions about the long-term viability of physical stores and town centres.
