A MAJOR high street discount chain has been sold in a deal affecting more than 300 stores.
The investment group Fortress has struck a deal with the owner of Poundstretcher.
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The bargain chain, which has 322 sites across the UK, has been owned by businessman Aziz Tayub for the past 18 years.
Today’s news, first reported by Sky News, has been confirmed by Fortress.
The price of the sale is yet to be announced.
Fortress has a history of buying up brands – it snapped up Majestic Wine back in 2019 before buying Punch Pubs in 2021.
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The deal will not have any impact on customers, staff or stores.
Ahsan Aijaz of Fortress Investment Group said: “Poundstretcher is an exciting business in a critical part of the UK retail sector, and we recognise its importance to consumers across the country.
“Fortress believes in empowering management teams to deliver their strategy and we look forward to working with the team to invest in and grow Poundstretcher.”
As part of today’s announcement, current owner Tayub thanked the company for its work over the past nearly two decades.
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He said: “I am very pleased that the Fortress team will be providing the resources and investment needed to take Poundstretcher to its next stage of growth following my retirement.
“Fortress is well placed to work with the fantastic Poundstretcher team, who I’d like to thank for their hard work and dedication during the 18 years that we’ve grown the business together, and I look forward to watching and cheering their shared success in the years ahead.”
I’m a money-saving mum – here’s the 99p bargain buy from Poundstretcher I swear by to keep my house damp free with no heating
Poundstretcher is one of the UK’s biggest discounters, rivalling high street giants Poundland and B&M.
It specialises in selling cheap goods like toiletries, homeware, gardening and food and drink items.
The firm is based in Leicester and employs around 4,000 staff.
In July 2020 the store entered a CVA which allowed the business to restructure and continue trading.
At the time, it closed 500 branches and paid around £13million of what it owed.
In March 2022, 17 stores were shut and over 1,000 retail jobs were cut.
It was around this time Poundstretcher’s profits halved – yet, the company was still pushing for an aggressive expansion.
Poundstretcher exited its CVA in October 2022 and says it is on track to deliver an improved performance for 2024.
OPENINGS AND CLOSURES
The retailer has shut more stores in recent times.
Most recently, the Poundstretcher in Chesterfield shut its doors for the final time on March 16 in a blow for locals.
The discount chain also pulled down the shutters on branches in Kilmarnock, Scotland, Romford, Grimsby and Ebbw Vale, Wales.
Poundstretcher has been opening new stores too, though.
In February last year, the retailer revealed plans to open 50 more stores before the end of 2023.
It said at the time it anticipated the new shops would create 2,000 jobs over the next five years.
In recent months it has also set about breathing new life into the sites of ex-Wilko stores.
The Sun has found that since November last year, the bargain shop has taken over seven former Wilko units.
The most recent one is the ex-Wilko store in Hayes, west London.
Retailers closing stores in 2024
RETAILERS have been feeling the squeeze since the pandemic, while shoppers are cutting back on spending due to the soaring cost of living crisis.
High energy costs and a move to shopping online are also taking a toll, and many high street shops have struggled to keep going.
Here’s a list of all the big-name brands closing stores this year:
- Argos – The brand announced plans to close 100 standalone UK branches last year as it looks to move away from the high street and focus on expanding its presence in supermarkets.
- B&Q – The chain has over 300 shops across the UK, so chances are you have one near you, but some stores have closed in recent months.
- Boots – The health and beauty chain announced that it would be closing 300 stores last July. Closures are ongoing and this will see the retailer’s estate reduced from 2,200 to 1,900 shops.
- Clintons – Clintons mulled plans to close 38 shops in a bid to avoid insolvency late last year. We’ve listed the stores affected.
- Costa Coffee – The caffeine giant has around 2,000 sites nationwide, so chances are you’ll have one near you. The chain has shut the doors to dozens of its sites recently. We’ve revealed which stores are due to close this year.
- Iceland – The supermarket has more than 900 stores but closed nearly two dozen sites in 2023, and more selected shops are due to shut.
- Lidl – The supermarket, which has 950 stores, is changing up shop locations, which has meant that some stores have to close. But the retailer is also looking to open 12 new supermarkets.
- M&S – M&S, which runs 405 stores across the country, has been closing a string of branches across the country in a blow for shoppers. It’s not all bad news, though, because the chain also has big plans to open dozens of new shops as well.
- Trespass – The firm announced in July last year that it was closing six branches, but more are on the way.
- WHSmith – The retail giant, which runs over 1,100 stores, has shuttered eight stores since March 2023, but more are coming.
What else is happening on the high street?
Other big name chains have been either put up for sale or sold in recent months.
Homebase could be put up for sale after discussions were reportedly held with potential buyers, including big-name discounters.
It would be the second time the chain has been put up for sale in four years.
Last year, both B&M and The Range bought parts of Wilko‘s business after it collapsed.
B&M bought up to 51 stores from the rival in a £3million deal – to be converted into B&Ms.
Wilko’s name and intellectual property were bought by rival discounter The Range earlier in the summer.
CDS Superstores, which trades as The Range and Wilko, revealed in December that it would relaunch the chain across Britain’s high streets.
Elsewhere, two major high street brands could step in and save parts of Ted Baker after the retailer fell into administration.
Next and the Frasers Group, owned by Mike Ashley, are reportedly eyeing up some of the ailing retailer’s stores.
Hobbycraft’s owner, Bridgepoint, is said to be exploring “strategic options” for the business, which could include putting the retailer up for auction.
The private equity group has hired US investment bank Raymond James to review the retailer’s operations.
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The review could result in Hobbycraft, which employs around 1,500 people across more than 100 stores in the UK, being put up for sale.
Meanwhile, a family restaurant chain owner has announced plans to close 18 branches and Superdry is set to close a branch in Dundee this month in another blow to the British high street.
Why are retailers closing stores?
RETAILERS have been feeling the squeeze since the pandemic, while shoppers are cutting back on spending due to the soaring cost of living crisis.
High energy costs and a move to shopping online after the pandemic are also taking a toll, and many high street shops have struggled to keep going.
The high street has seen a whole raft of closures over the past year, and more are coming.
The number of jobs lost in British retail dropped last year, but 120,000 people still lost their employment, figures have suggested.
Figures from the Centre for Retail Research revealed that 10,494 shops closed for the last time during 2023, and 119,405 jobs were lost in the sector.
It was fewer shops than had been lost for several years, and a reduction from 151,641 jobs lost in 2022.
The centre’s director, Professor Joshua Bamfield, said the improvement is “less bad” than good.
Although there were some big-name losses from the high street, including Wilko, many large companies had already gone bust before 2022, the centre said, such as Topshop owner Arcadia, Jessops and Debenhams.
“The cost-of-living crisis, inflation and increases in interest rates have led many consumers to tighten their belts, reducing retail spend,” Prof Bamfield said.
“Retailers themselves have suffered increasing energy and occupancy costs, staff shortages and falling demand that have made rebuilding profits after extensive store closures during the pandemic exceptionally difficult.”
Alongside Wilko, which employed around 12,000 people when it collapsed, 2023’s biggest failures included Paperchase, Cath Kidston, Planet Organic, Snug and Tile Giant.
The Centre for Retail Research said most stores were closed because companies were trying to reorganise and cut costs rather than the business failing.
However, experts have warned there will likely be more failures this year as consumers keep their belts tight and borrowing costs soar for businesses.
The Body Shop and Ted Baker are the biggest names to have already collapsed into administration this year.
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