BARGAIN retailer Wilko is on the brink of collapse, with 12,000 people at risk of losing their jobs as a result.
The high street retailer today filed a notice of intent to appoint administrators, following reports that the business was exploring the possibility of a sale.
The boss of the homeware and hardware chain said it is expected to enter insolvency after failing to secure a takeover to help the business with "mounting cash pressures".
"We'll continue to progress discussions with interested parties with the aim of completing a transaction which preserves the business," Wilko chief executive Mark Jackson said.
The budget store has around 400 shops across the country, meaning store closures could put the jobs of approximately 12,000 people at risk.
Read our Live Blog below for the latest news and updates…
- By Henry Moore
What will happen to Wilko?
Wilko today confirmed today that it is on the brink of administration.
If Wilko does file for administration this means all control of the business is passed to an appointed administrator – who has to be a licensed insolvency practitioner.
Their goal is to leverage the company's assets and business to repay creditors.
It doesn’t necessarily mean the end of the business.
Instead, administrators will try to help a company find ways to repay debts or solve its cash flow problems.
Administration can last anywhere from a few weeks to up to a year or more.
- By Henry Moore
Wilko believes in 'robust turnaround plan'
Mark Jackson, the chief executive of Wilko, has said the company is committed to its "robust turnaround plan" as bosses attempt to bring the business back from the brink.
He confirmed Wilko is seeking a resolution "as fast as possible."
“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.
- By Henry Moore
What does going into liquidation mean?
Liquidation is slightly different to administration.
Where administration aims to help the company repay its debts, liquidation is the process of selling all assets and then dissolving the company completely.
This essentially means that liquidation signals the end of the business as it ceases to trade and all assets are 'liquidated' into cash.
- By Henry Moore
Devastated Brits take to social media
Heartbroken Wilko customers have rushed to social media following today's news.
One wrote: "Just fell to my knees. Wilko is one of the only useful shops still on the highstreet."
While another Twitter user added: "Wilko’s gone into administration. This is BAD."
And a third jokingly said: "How can Wilko be going under when I buy so many bits? Where is the money from my bits going?"
Importantly, Wilko is yet to actually enter administration.
- By Henry Moore
Will Wilko stores close?
Wilko has 400 stores across the UK, but will today's news mean they are set to close?
While it hasn't been confirmed whether they will remain open or shut down, news of Wilko being on the verge of collapse certainly doesn't bode well for the chain.
- By Henry Moore
'Significant interest' in Wilko purchase
Wilko chief executive Mark Jackson confirmed there has been "significant levels of interest" but that the business has not yet received an offer.
And added that it was for that reason the retailer was having to take the "difficult decision to file an NOI."
He said: "We’ll continue to progress discussions with interested parties with the aim of completing a transaction which preserves the business and will encourage those interested parties we’re in discussions with to move as fast as possible."
- By Henry Moore
Wilko planned to cut 400 jobs
Earlier this year, Wilko revealed it planned to cut over 400 jobs, including both store and head office roles.
Around 12,000 people work for the bargain brand and it remains to be seen how today's news will impact their jobs.
- By Henry Moore
Wilko not the only high-street retailer facing financial trouble
Numerous high-street brands have collapsed into administration in the last 12 months.
From the Scottish clothing brand M&Co to wellies store Joules, a number of familiar brands went bust in 2022.
Major burger chain Byron Burger fell into administration in January and immediately shut all nine restaurants.
Paperchase then collapsed into administration at the end of the same month and all 106 stores have since closed for good.
- By Henry Moore
How does administration work?
The administrator will write to your creditors and Companies House to say they’ve been appointed.
They will try to stop the company being liquidated but if they can't, the administrator will pay as much of the company's debts as possible from the assets.
The administrator has eight weeks to write a statement explaining what they plan to do.
This must be sent to creditors, employees and Companies House and invites them to approve or amend the plans at a meeting.
- By Henry Moore
What does going into administration mean?
When a company enters administration, all control is passed to an appointed administrator – who has to be a licensed insolvency practitioner.
Their goal is to leverage the company's assets and business to repay creditors.
Once the administrator has taken over, a moratorium is placed around the company and stops all legal actions.
After the administrator takes over, there isn't much that can be done to reverse the process.
- By Henry Moore
Who owns Wilko?
Wilko was founded in 1930 by James Kensey Wilkinson and it remains privately owned.
The Wilkinson family hold the largest stake in the business, but could give this up to secure its future, according to the report.
- By Henry Moore
What have Wilko's bosses said?
Wilko chief executive Mark Jackson confirmed there has been "significant levels of interest" but that the business has not yet received an offer.
And added that it was for that reason the retailer was having to take the "difficult decision to file an NOI."
He said: "We’ll continue to progress discussions with interested parties with the aim of completing a transaction which preserves the business and will encourage those interested parties we’re in discussions with to move as fast as possible."
The retailer is being advised by PwC, while property agents CBRE had been brought on board to negotiate with landlords.
A notice of intention gives Wilko a ten-day window to secure a deal while protected from action by other creditors.
- By Henry Moore
Wilko to go into administration leaving high street giant with 400 stores on brink of collapse
Wilko is on the brink of administration, putting 400 stores and thousands of jobs at risk.
The bargain retailer today filed a notice of intent to appoint administrators.
It comes as Wilko's owners were said to be exploring the sale of a controlling stake just last month.
The discount chain has 400 shops and employs about 12,000 people.
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