In continuation of our series of workers union news articles closely monitoring the ongoing situation with Wilko, we bring to you the latest update: B&M, a prominent FTSE 100 retailer, has successfully purchased 51 shops from Wilko for a sum of £13 million following Wilko’s recent plunge into administration.
The acquired shops are slated for a rebranding makeover under the B&M label, since the deal didn’t encompass Wilko’s brand name or its intellectual property rights. B&M has intimated the public that further details on the reopening schedules for these new stores will be provided come November.
It’s noteworthy to mention that B&M is the inaugural firm that has stepped in to salvage a portion of the Wilko empire since its downfall. However, a considerable chunk of the business is still waiting for potential buyers.
Amidst this backdrop, we’ve learned from our previous investigations that a more substantial rescue initiative by Doug Putnam, the proprietor of HMV, faced some hitches, potentially leading to the shuttering of a significant number of stores. We reported earlier this week about the heartbreaking redundancies initiated at Wilko’s primary office and the impending job losses expected in the warehouse division, given the absence of inclusive bids.
Nevertheless, the current B&M deal is a silver lining for many retail employees, securing their positions.
While B&M confirmed its payment plan through its cash reserves, it remained tight-lipped about the specifics of the stores involved or if all employees at these stores would be retained.
Last month’s takeover of Wilko by administrators at PwC was a direct result of the failed attempts to vend the complete business. Their primary target was to liquidate as many stores as feasible to benefit the retailer’s creditors. As we had highlighted in one of our past articles, Doug Putnam, with his history of reviving HMV, had ambitions to acquire nearly 300 of the 400 Wilko outlets. However, post some supplier challenges, he might now settle for around 200.
For a brief historical perspective, Wilko, initially established as Wilkinson Hardware Stores, boasts 400 outlets in its portfolio, employing a staggering 12,000 personnel.
Other competitors in the discount retail space, such as Poundland’s parent company, Pepco, and The Range, are rumoured to be prospective Wilko shop purchasers.
From our interviews with market experts, the consensus is clear: Wilko’s inability to evolve with shifting consumer patterns was its Achilles heel, especially in the backdrop of the pandemic. A substantial reliance on foot traffic in their expansive high-street stores posed challenges when the pandemic shifted the majority of the retail dynamics online.
Finally, in financial news, a slump of over 6% was noticed in B&M’s shares today prior to this announcement, attributed to a downgrade from JP Morgan analysts. Post this reveal, a minor rebound in shares was observed, though they are still trading at a lower margin for the day.
The Workers Union Says…
“We will continue its vigilant tracking of these developments, ensuring transparency and providing timely updates to our members and readers.”