Key facts
- Gordon Brothers released £21m of £50m it had been accused of withholding from Poundland.
- About 16m grocery items went to 600 shops in the UK and Ireland over the weekend.
- Poundland has until November 26 to find a buyer under the court extension.
- Poundland said it is in discussions with three potential buyers.
- Martin Property Group is Poundland's preferred bidder, but talks stalled over loan repayment terms.
- Gordon Brothers denied freezing funds that should have been available to Poundland.
Poundland's US owners have released £21m of £50m that the discount chain's management had accused them of withholding, funding an emergency resupply that sent about 16m grocery items to 600 shops in the UK and Ireland over the weekend. Senior Poundland staff codenamed the effort "Operation Gloria", after the Gloria Gaynor song I Will Survive, which soundtracked a social media video showing pallets of Yorkshire Tea and Pot Noodles moving from depots to shelves.
The money provides breathing space while rescue talks continue, keeping suppliers sending goods during the pre-Christmas trading period. Poundland filed a notice of intention to appoint administrators at the end of last month, putting 12,000 staff and about 2,000 suppliers into uncertainty. Last week the chain won high court approval for an extension of legal protection from creditors, giving it until November 26 to find a buyer.
Gordon Brothers, which MPs have accused of "predatory capitalism", bought Poundland from the Polish retail group Pepco last year for a nominal £1 and says it rescued the company when nobody else would. Documents provided to MPs showed the finance firm had taken close to £20m in interest payments and fees, including those relating to store closures since the acquisition. Gordon Brothers has denied freezing any funds that should have been available to Poundland and pointed to loans it has provided to prop up the company.
Poundland said it is in discussions with three potential buyers. Bids from Xyra Group Holdings and Innovest are understood to have relatively little chance of success, while Martin Property Group, a Northern Irish company, is the preferred bidder but progress has stalled over the repayment terms of a loan from Gordon Brothers. A number of high-street retailers, including Tesco, are understood to be eyeing some of Poundland's shops.
The company and Gordon Brothers face talks with potential buyers and business secretary Jonathan Reynolds, who plans to meet them before the deadline, according to a report by Sky News. Reynolds and Andy Burnham have expressed concerns about Gordon Brothers' conduct, and the prime minister asked why the US company has yet to accept an offer for a business that employs 11,000 people. Liam Byrne, chair of the business select committee, likened Gordon Brothers to "the wolf of Wall Street, on the British high street". The Guardian approached Gordon Brothers, the business department and Poundland for comment.