Major UK retailer is on brink of collapse with 12000 jobs at risk

Thousands of jobs at Wilko are at risk of being axed after it emerged the discount retail giant is reportedly on the brink of collapse. 

Some 12,000 jobs across 400 stores could be in the firing line after the high street chain signalled it faced insolvency proceedings.  

The privately-owned firm, which sells everything from stationery to hardware items, has filed notice of its intention to appoint administrators at the High Court after spending weeks hunting for a rescue deal.

The news is another blow for Britain's beleaguered shopping districts, which have been plagued by sweeping closures during the cost-of-living crisis, with high street favourites Iceland, Argos and Boots shutting scores of stores.

Wilko started from a single hardware store in 1930. At the beginning of this year it secured a £40million lifeline from Hilco UK, the owner of Homebase.

Scroll down to see a full list of the towns and cities where stores are now at risk.

Wilko is on the brink of collapse after the firm revealed it was filing a notice of intention to appoint administrators

The notice of intention to appoint administrators gives the firm a 10-day window to secure a deal while protected from action by creditors. 

Wilko chief executive Mark Jackson said: 'While we can confirm we've had a significant level of interest, including indicative offers that we believe would meet all our financial criteria to recapitalise the business, at present we don't today have an offer that provides the necessary liquidity in the time we have available, given the mounting cash pressures we're faced with.

'Unfortunately, with this in mind, today we're having to take the difficult decision to file a notice of intention.

'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.

'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.'

The retailer is being advised by PricewaterhouseCoopers (PwC), while property agency CBRE had been brought on board to negotiate with landlords. 

Last week the GMB union cancelled a planned meeting with its Wilko members because 'the company have shared that they hope to be able to provide us with a more detailed update next week'.

Speaking of today's news, GMB's national secretary Andy Prendergast, said: 'This is extremely concerning but we remain hopeful that a buyer can be found.

'Wilko's staff deserve reassurance that their jobs are safe. We hope this is the number one priority going forward.'

News of the bargain chain's difficulties has left shoppers stunned. One person tweeted: 'Just dropped to my knees, please tell me this isn't happening.' Another added: 'Losing Wilko is like losing Woolworths all over again!' 

Wilko, which employs about 12,000 people, started from a single hardware store in 1930. It secured a £40million lifeline from Hilco UK, the owner of Homebase, at the beginning of this year. 

While a third said: 'This is genuinely bad. Wilko is one of the only affordable shops where you can get homeware and utilities. Everywhere else is so over-priced. It's a genuine lifeline of a shop for students and those on lower incomes.'

Wilko has faced significant challenges with stock supply due to credit limits with suppliers. 

Last month it was revealed the Wilkinson family, which owns the firm, was mulling a sale of the business, meaning the high street giant would fall out of its hands for the first time.

To help salvage it, Hilco - the specialist retail investor which owns Homebase - poured millions of pounds of funding into Wilko.

The company agreed to amend the terms of a credit facility to bolster the availability of financing to Wilko as the chain continued to grapple with its financial woes.

The amendment follows a £40million loan Wilko secured from Hilco at the start of the year, reported Sky News. 

Tim Symes, an insolvency and asset recovery lawyer at UK firm Stewarts said if Wilko were to collapse, its disappearance would be a 'serious blow to the already ailing' British high street.

'However, administration is principally a rescue process for companies or their businesses, and so, even if that happens, we can expect this staple homeward chain to survive in one iteration or another albeit with its creditor shackles significantly loosened,' he told MailOnline. 

The financial struggles come as Britons continue to be punished by crippling interest rates and the cost-of-living crisis, with many shoppers forced to switch their normal shopping habits. 

Cut-price retailers have not been immune to the tough economic situation, with a series of well-known budget retailers such as Iceland, Poundland and B&M Bargains having to close some UK stores.

Iceland has shut the doors to more than 12 shops this year and Boots said it was closing 300 branches.

Argos announced plans to close another of its UK stores, meaning it will close eight shops across Britain this autumn.

More Argos stores are set to close down next month amid plans for 100 to shut within the next year

The full list of Argos stores already closed in the UK and those set to close this autumn

The catalogue retailer, owned by Sainsbury's, has already shut four stores across Britain as it pushes ahead with plans to shutter 100 of its shops by 2024.

Argos is planning to close its outlet in the Morfa Shopping Park in Swansea on August 22 in line with the company's plans to move away from the high street.

The firm, which is based in Milton Keynes, is shutting shops and in some cases replacing them with smaller branches inside Sainsbury's supermarkets. 

Argos's closures come as an array of the UK's top high street brands have begun shuttering stores amid the rise of online shopping and the cost-of-living crisis. 

One retail expert has told MailOnline that the 'culture of bargain-hunting for fun is over, at least for now', adding that discount stores which do not sell essential items will 'struggle in the current environment'.

Frozen food giant Iceland, which has opened 200 stores in the past ten years, said any closures  were part of a continual review of its operations. 

Executive chairman Richard Walker told MailOnline: 'Across Iceland and The Food Warehouse we have a portfolio of over UK 1,000 stores, and our retail estate has grown by nearly 200 stores over the last ten years. 

'We typically open more than 20 new stores each year, creating many new jobs and contributing to the growth of local economies. 

'At the same time, we continually review the retail experience offered to our customers and have always made a small number of store closures every year, as local shopping patterns change and shop leases expire. 

'The business is currently trading very strongly, achieving record market shares.' 

A number of major UK retailers and banks have closed high street branches so far in 2023, including big-name brands including Marks & Spencer, Boots and New Look.