The Canadian entrepreneur who owns HMV has put in a last-ditch bid to rescue the discount retailer Wilko with a proposal that could save 350 stores and 10,000 jobs.
The new bid emerged as union leaders called for Wilko’s 12,500 employees to be prioritised, after an earlier offer from Doug Putman was rejected because debt holders could recoup more from a break-up of the business.
Putman, who rescued HMV from administration in 2019 and returned it to profit, submitted an improved offer on Friday. Under his plan the stores would continue to operate under the Wilko brand.
Sources said Putman had been in talks with Wilko’s administrators at PwC for at least two weeks but his previous offers could not match the cash raised from liquidating the chain’s assets, including its leaseholds and stock. Wilko’s biggest creditor is the restructuring specialist Hilco, which loaned the company £40m shortly before it went bust.
Andy Prendergast, the national secretary of the GMB union, said: “Working people’s livelihoods should not be treated like chess pieces – to be traded off against the interests of the wealthy. Any resolution to the Wilko debacle needs to prioritise their interests.”
Sources said the offers Putman had previously put forward so far had “never been credible”.
His initial proposal, first reported by the Times, involved taking on 200 stores and saving 4,000 jobs, but the entrepreneur seems to have improved his offer before a Friday deadline set by PwC.
Hilco has taken on a number of distressed retailers, including the DIY chain Homebase and HMV before it collapsed and was acquired by Putman. It was poised to buy Woolworths for £1 in 2008 after taking control of a large portion of the budget retailer’s debt before it collapsed.
Administrators from PwC, who were appointed to Wilko this month as it ran short of cash, said on Wednesday evening that it was “likely that there will be redundancies and store closures in the future” as they had not found a buyer for the whole group.
Unless Putman succeeds, closures are expected to begin within weeks.
A spokesperson for the administrators said: “Since our appointment as administrators of Wilko we have worked relentlessly to secure a sale of the business, and talks are continuing with a number of parties.
“We’re intent on achieving the best outcome for everyone involved while preserving as many jobs as possible and adhering to our statutory duty to act in the best interests of the creditors as a whole.
“It would be inappropriate to comment on individual bidders or interested parties at this stage in the process.”
The chain’s stores are expected to be bought by rival bargain retailers such as Poundland, Home Bargains, Primark and B&M, who will rebrand them and may not retain the existing staff, while landlords in some sites may divide up the space.
Property experts said it was unlikely any individual retailer would take more than 50 stores.
Wilko, founded in 1930 when JK Wilkinson opened his first store in Leicester, stepped into many high street gaps left by the collapse of Woolworths in late 2008.
The family, which still controlled the group until administrators were called in on 10 August, paid themselves £3m in dividends in the 12 months to the end of February 2022 despite falling to a loss that year, as first revealed by the Guardian.
Prendergast said: “GMB will not forget that had money not been siphoned out of the business, and warnings listened to, we might not be in this sorry state at all.”
