Former Cath Kidston owner Hilco joins running for Poundland

Hilco Capital has reportedly joined the race for British budget retailer Poundland. The investing firm, which most recently acquired Lakeland, is said to be mulling a bid for the chain store alongside Alteri Investors and turnaround firm Endless.

Modella Capital, which is overseeing the ongoing restructuring of The Original Factory Shop, is also believed to be among the potential bidders, Sky News has reported.

Poundland was put up for sale by its Polish parent company Pepco Group earlier this year, after the launch of a turnaround plan was unable to mitigate mounting losses. Teneo was appointed to advise an auction of the retailer in March, with the bidding deadline now approaching.

In March, Pepco CEO, Stephan Borchert, confirmed that the company was “actively exploring separation options for Poundland”, a decision triggered by the “increasingly demanding UK retail environment” that has been further exacerbated by the UK government’s tax changes.

Poundland had already been somewhat of a financial burden for Pepco, however, with challenging trading conditions causing declines in sales over the past year. For the first quarter of its current financial period, the retailer saw LFL sales drop 7.3 percent, with clothing and general merchandise particularly underperforming.

Pepco and Hilco have declined a request to comment. FashionUnited has contacted Endless with a request to comment.