Iceland is interested in buying a limited number of Poundland stores in the event the troubled retailer’s owners cannot find a single buyer, City AM can reveal.
The discount supermarket will be on the lookout for a small number of shops if Poundland’s 600-store estate ends up being split apart, sources said.
Iceland, which specialises in frozen goods, runs more than 900 stores in the UK and holds 2.2 per cent of the UK’s grocery market.
A spokesperson for the supermarket chain said: “Iceland are always looking at potential new locations as part of its ongoing operations.”
Gordon Brothers, the Boston-based investment firm which owns Poundland, is hoping for a rush sale of the discount retailer and has received a number of offers for the entirety of the company.
But Poundland could end up being broken up among a number of buyers if none of these bids are deemed suitable.
Between six and eight retailers have tabled formal bids to buy just some of Poundland’s stores, with these offers ranging from hundreds to just a few of its locations, sources close to the sale said.
A number of high street firms are waiting in the wings to swoop in on their preferred Poundland locations if a break-up of the budget retailer becomes the only option for Gordon Brothers.
Discount supermarket Lidl has tabled a bid for one store in the hopes of picking up several more in the event of a break-up, City AM revealed last week.
Grocery buyers are likely to be interested in the location of Poundland’s stores rather than the stock of the company, analysts have said, with retail firms racing for high quality space on high streets.
Other retailers including B&M, The Range and Poundstretcher – Poundland’s American rival – are interested in snapping up varying numbers of shops if the company is split apart.
Poundland hopes for rush sale
Martin Property Group, the Irish firm which recently bought National Car Parks (NCP) out of administration, is Poundland’s preferred bidder among those who want to acquire the entire business.
Three merger and acquisition (M&A) experts were parachuted onto Poundland’s board last week to reassure other bidders that the process would be run fairly, after managing director Barry Williams and finance chief Shaun Wills endorsed Martin’s bid.
Andrew Kirkpatrick, Stephen Welch and Dominic Young have begun reviewing the bids tabled for the retailer, in the hopes of securing a sale before the crucial pre-Christmas trading period kicks off in earnest.
Gordon Brothers have overhauled Poundland since they bought it from European retail group PepCo for a nominal £1 last year.
The retailer’s management says it is gathering momentum, pointing to like-for-like sales growth of 3.3 per cent in the last three months. The group is on track to beat last year’s earnings by £80m.
Gordon Brothers declined to comment.