Gordon Brothers Releases £10m to Poundland as Deadline Nears

Gordon Brothers has released about £10 million to Poundland as the retailer faces a deadline to secure a rescue and avoid administration. The payment is described by sources close to the matter as an initial instalment intended to help pay suppliers, while efforts continue to find a longer-term solution.

Poundland filed a notice of intention to appoint administrators on October 29, triggering a 10-working-day moratorium on creditor action. The notice is due to expire on Thursday, November 12. Further legal steps could affect the timetable, and a prospect of a solvent deal could allow the deadline to be extended.

Suppliers of goods for resale have reportedly not been paid since October 27, after access to credit facilities and cash generated through trading was restricted. Reports put the inaccessible funds at about £50 million, including cash that had accumulated from sales. A separate estimate put inaccessible cash at about £25 million on November 3, with the amount believed to have increased afterward.

Poundland can continue selling stock already in its shops, but the reported interruption to supplier payments has prevented it from replenishing inventory. The retailer operates...