Wilko redundancies on hold as administrators assess bids

Planned redundancies at collapsed UK retailer Wilko have been put on hold while administrators consider bids to rescue the struggling chain.

Wilko entered administration last month, putting over 12,000 jobs and 400 stores at risk. However, administrators from PwC have suspended job cuts while assessing offers to salvage parts of the business.

The pause came after union GMB called an urgent meeting with PwC and wrote to the UK business secretary voicing concerns over the process. It warned Wilko was “not out of the woods yet by any means”.

Though a positive step, GMB’s secretary said this remains an “incredibly stressful time” for Wilko staff facing uncertainty over their livelihoods.

PwC continues engaging with interested parties and is focused on achieving the best outcome possible for creditors and employees. But guarantees over jobs and stores are elusive.

Reports suggest some industry experts are sceptical a deal will emerge as liquidation may produce a better return for creditors. Hilco, which lent Wilko £40 million, is one key creditor.

An offer from private equity firm M2 Capital has emerged to buy Wilko as a going concern and preserve all jobs for two years. But its £90 million bid may face challenges.

Previous Wilko chair Lisa Wilkinson said “everybody has thrown everything” at rescuing the chain, including staff, suppliers and landlords. However, the firm has battled challenging retail conditions.

With the administrator’s duty being maximizing creditor returns, a deal to save the 90-year-old chain still looks uncertain. The pause on job cuts has offered slight relief but anxiety persists.

Unless a credible rescue offer is binding soon, Wilko likely faces an extensive restructuring or liquidation. For employees, the coming days will remain extremely nervy as their fate hangs in the balance.