Wilko set to enter administration

Household goods retailer, Wilko, is set to be enter into administration putting over 12,000 jobs and 400 stores, including at Stockport Retail Park, at risk.

The East Midlands-based chain was founded in Leicester in 1930 as Wilkinson Cash Stores, rebranding to Wilko in 2012. The brand was among the fastest growing retailers in the 1990s, and benefited from the 2008 loss of Woolworths from the high street, the chain has in recent years faced stiff competition from out-of-town rivals Home Bargains and B&M.

In recent months, the retailer has, however, struggled in the face of inflationary pressures and supply chain challenges. The business announced over 400 redundancies earlier this year, as well as securing a £40 million credit facility, but has in recent weeks failed to agree a company voluntary arrangement (CVA) deal that would ensure the retailer has the liquidity needed to deal with current cash pressures.

Wilko has now issued a notice to appoint administrators with the high court, with advisory firm PwC set to step in after already working with the retailer to secure a buyer. The business now has a 10-day window of protection from its creditors during which it will aim to strike a deal to guarantee the future of 90-year old retail chain and protect its 12,000 employees and 408 stores nationwide. The chain’s Stockport store opened in 2017, an employs around 40 staff.

Wilko’s chief executive Mark Jackson 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 NOI.”