TG Jones owner Modella Capital has pulled out of the race to buy Poundland but will still look to pick up some of its stores if a sale process collapses, City AM can reveal.
The private equity firm, which also owns Flying Tiger, had expressed an interest in bidding for the entirety of Poundland but has since withdrawn its interest, sources said.
The investment firm may still join the battle to pick up individual Poundland stores should the company be broken up by its owners, Gordon Brothers, the sources added.
Poundland’s owners are still hoping to find a buyer for the budget chain but retail union Usdaw warned last week the company is teetering on the brink of collapse.
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. 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.
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.
Poundland has been contacted for comment.