High street giant Wilko likely to enter administration

About 12,000 retail jobs could be at risk after budget UK homewares retailer Wilko today filed a ‘notice of intention’ at the High Court to appoint administrators.

Chief executive Mark Jackson said the firm was talking with interested parties about options for the business but had not yet achieved any deal on investment.

PwC had been appointed by the firm to try to find a buyer in recent months in a bid to secure the additional cash to keep trading at Wilko’s 400 UK stores.

Last year the retailer borrowed £40m from restructuring specialist Hilco, cut jobs and revamped its leadership team after falling to a loss and facing a cash squeeze.

The purpose of a notice of intention is to protect businesses from creditors for 10 days, so as to give it time to secure finances. The notice does not necessarily mean that administrators will be appointed.

Mark Jackson, the chief executive of Wilko, said: “While we can confirm we’ve had a significant level of interest, including indicative offers that we believe would meet all our financial criteria to recapitalise the business, at present, we don’t today have an offer that provides the necessary liquidity in the time we have available, given the mounting cash pressures we’re faced with.

“Unfortunately, with this in mind, today we’re having to take the difficult decision to file a notice of intention to appoint administrators.

“We continue to believe that our robust turnaround plan, with significant re-stabilisation cost savings in progress, will deliver a profitable Wilko and maximise the significant opportunities that we know exist,” he said.

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Andy Prendergast, national secretary at the GMB union, said: “This is extremely concerning but we remain hopeful that a buyer can be found. Wilko’s staff deserve reassurance that their jobs are safe. We hope this is the number one priority going forward.”

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