B&M agrees to buy 51 Wilko stores from UK retailer’s administrators

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Discount retailer B&M has agreed to buy 51 of rival Wilko’s 400 stores for £13mn from the administrators, as the fate of the rest of the UK high-street chain remains uncertain.

The news comes amid ongoing talks between PwC and others about salvaging parts of Wilko, which went into administration last month with thousands of jobs put at risk.

HMV’s owner Doug Putman is eyeing about 200 stores following discussions with Wilko’s suppliers, less than the 300 he originally planned to acquire, according to two people familiar with the matter. A representative for Putman declined to comment.

B&M said it would provide more details about its plans in November when it publishes its interim results but added that it would not retain the Wilko brand. It was unclear if any of the staff in the acquired stores will be kept on.

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Almost 300 Wilko staff have already been made redundant, with PwC warning that more job losses will be announced this week.

Simon Arora, founder and former chief executive of B&M, last week wrote to one of the Wilko bidders, who subsequently dropped out, to say he was “astonished” they were bidding for the entire chain. He said there was “ample interest from other discounters such as B&M” in Wilko’s outlets and B&M was targeting “the good stores”.

Administrators are expected to share an update on the fate of the chain later on Tuesday.

The administration process, now in its fourth week, descended into chaos last week after M2 Capital, a last-minute bidder for the entire chain, was unable to provide substantial proof that it could afford it, delaying talks with other suitors.

It is one of the biggest retail casualties in the UK in recent years following the collapse of Sir Philip Green’s retail empire and department store chain Debenhams, and more recently McColl’s, the corner shop chain that was subsequently bought by Morrisons.

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Like many high street chains, Wilko was hit by inflationary pressures and supply chain problems amid a cash crunch.

In January, it borrowed £40mn from Hilco, the special situations investor that is separately advising PwC on the possible liquidation of some assets, including stock, if no bidder is found.

Source: https://www.ft.com/content/32def21f-1d3d-4d5f-8dc3-97381bce574f