Pepco Group has sold Poundland to Gordon Brothers International LLC for £1 with dozens of planned store closures.
Poundland, currently employing 16,000 people across over 800 stores in the UK, Isle of Man and Ireland, completed the sale in a move aimed at restructuring its operations and focusing on higher-margin growth through its core Pepco brand.
The deal, announced today, sees Pepco Group retain a £30m secured loan and other financial support, including an overdraft facility of up to £30m to be implemented following a proposed restructuring.
The sale aligns with Pepco’s strategy to structure and accelerate growth in its strongest categories and markets, reduce exposure to lower-margin FMCG lines, and concentrate on expanding its more profitable clothing and general merchandise ranges.
This sale will enable the group to focus on expanding its core Pepco brand, which generates the majority of its earnings and the highest returns on capital.
Last year, Poundland generated a third of the group’s revenue but only 5% of EBITDA.
As part of the agreement, the business will be led by Barry Williams, currently managing director of Poundland. All of Poundland’s stores and employees in the UK, Ireland, and the Isle of Man will move to Gordon Brothers.
The retailer will continue to trade under the Poundland name in the UK and as Dealz in Ireland and the Isle of Man.
Pepco is expected to take a minority stake in Poundland following a proposed restructuring plan, subject to High Court approval.
The group has also signed transitional service agreements with Poundland to support procurement, IT, and operations during the handover period.
Stephan Borchert, Pepco Group chief executive, said: “The agreed sale of Poundland marks an important milestone in our strategic plan to move away from FMCG and focus predominantly on Pepco, our higher margin clothing and general merchandise business.
“As set out during our Capital Markets Day in March 2025, this transaction will strongly support our accelerated value creation programme by simplifying the group and focusing on our successful Pepco business.
“Poundland remains a key player in UK discount retail, with millions of customers annually and a well-loved brand and proposition.”
Image © Geoff Moore/Shutterstock
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