Poundland owner may float amid plans to open new stores

The discount retail chain, which has its headquarters in Willenhall, is part of Pepco Group which has started talks with institutional investors about an initial public offering in either the UK or Poland

Pepco’s South African owner Steinhoff International bought Poundland for £600 million in 2016.

Pepco Group is run by Andy Bond, the former Asda chief executive, and employs more than 30,000 people. Its first stores using the Pepco brand opened in Poland in 2004 and the country now has more than 1,000.

In the UK Poundland has more than 500 stores. Pepco also includes discount retailer Dealz in Ireland.

A Pepco spokesman said the company is considering options in more detail, including a potential public listing of Pepco Group in either London or the Polish capital Warsaw, but no definitive decision has been taken with respect to any specific course of action

There were originally plans to go public last year which were halted by the pandemic.

A private equity takeover is also thought to be a possibility for Pepco Group.

Before the pandemic three private equity firms had also been preparing a £3.8 billion bid for Pepco. Advent International, which sold Poundland for £200m a decade ago, Hellman and Friedman and Mid Europa Partners were being advised by investment bank Rothschild over the deal.

Since 2019 Steinhoff and its creditors have been evaluating a range of strategic options for Pepco Group, including a trade sale.

In January, Pepco Group, which does not trade online, said it planned to open hundreds of stores across Europe this year despite its sales being dented by the pandemic.

In 2021 it plans to open more than 200 more Pepco stores,more than 50 Dealz shops and 20 Poundlands.

Poundland was listed on the London Stock Exchange from 2014 until Steinhoff bought it.

The chain was started in 1990 by Dave Dodd and Steve Smith and opened its first store in Burton upon Trent the same year.

Its head office was later in, Cannock Road, Wolverhampton, before the customer support centre and warehouse opened in Willenhall in 2000.

It was sold to Advent International two years later.

Poundland, which topped £1 billion in turnover for the first time in 2015, last year bought Fultons Foods, the north of England frozen food retailer, in a move that will create 1,000 new jobs.

It is enabling Poundland to roll out frozen and chilled foods to many of its stores