Wilko's Creditor Losses and Store Closures
Wilko, the retail chain, has suffered a significant blow as its creditors are expected to face vast losses. With 400 stores set to close and thousands of jobs to be axed, the future looks grim for the company. Last month, Wilko entered administration due to financial struggles caused by inflation.
Unsecured Creditors Only to Recover a Fraction of Debt
Sky News reports that unsecured creditors of Wilko may only receive as little as 4p for every pound owed to them by the company. Accounting giant PricewaterhouseCoopers stated that creditors should anticipate a recovery rate between 4 and 8 percent of their debts.
Pressure on the Wilkinson Family to Return Dividends
There are growing calls for the Wilkinson family, who owns the company, to return some of the millions they received in dividend payments. Between January 2019 and February 2022, the family collected dividends totaling an astonishing £9 million. The most recent payout of £750,000 was made in February last year.
Loss of Jobs and Failed Rescue Bid
When Wilko permanently closes its doors next month, over 12,000 high street jobs are expected to be lost. Despite efforts to secure a rescue bid led by HMV's Doug Putman, an agreement could not be reached. As a result, discount-store competitors Poundland, B&M, and The Range seized Wilko's sites and online assets, leaving workers unprotected.
Barclays, Hilco UK, and Pension Protection Fund Expectations
Major creditors Barclays and Hilco UK are projected to be repaid their owed amounts in full: £2.4 million and £39.9 million, respectively. Additionally, the industry-funded Pension Protection Fund, classified as a secured credit, will recover the £20 million it is owed. However, there is uncertainty about the millions it is owed as an unsecured credit.
PricewaterhouseCoopers declined to provide any comment when contacted by journalists.
